Rating revaluation - get ready

02/11/2009

By Joanne Wright, Senior Associate in Commercial Property & Development.

New rates assessments for commercial properties are due on 1 April 2010 when business rates are revalued.

The revaluations are based upon values as at 1 April 2008 - a date shortly after record rents were set in many parts of the country.

Many properties are currently undervalued and therefore will see above average assessment increases in 2010. Local Authorities are responsible for calculating the bills for rates and applying any discounts. It is anticipated that London will be hardest hit as London has seen the highest economic growth of any region and has the highest concentration of businesses.

Transitional relief

The Government propose a transitional relief scheme to phase in the increases resulting from the revaluation. The Government's preferred option is for annual caps on both increases and reductions over five years with different caps for small and large properties. The exact details are to be finalised.

The business rates deferral scheme

This will allow businesses in England to defer payment of 3% of their 2009 - 2010 bill.

Action to be taken

The Valuation Office Agency (VOA) updated the rating list and notified ratepayers of the new rateable values in October this year. The VOA also published the draft rating list online on 30 September 2009 so ratepayers and their advisers can check the valuations.

Businesses should consider now the impact of any likely changes in rate liability following the revaluation.