From April 2017 businesses whose properties have a Rateable Value of up to £12,000 will not have to pay business rates at all, a rise from £6,000 previously.
Property with a Rateable Value between £12,000 and £15,000 will receive tapered relief. Chancellor George Osborne says the ‘typical corner shop in Barnstaple will pay no business rates at all’.
Despite this, a survey by CVS, shows more than a third (36 per cent) of business owners are unfamiliar or unaware with the changes put in place by the government.
What’s more, three in ten small business owners, with between one and 49 employees, say the changes in business rates aren’t enough to help local businesses and our high street.
The amount that could be saved is up to £5,900 for those with a rateable value of less than £12,000 per annum.
Mark Rigby, chief executive at CVS Business Rates says that, on the whole, the changes are very positive for local businesses.
‘For many small firms, it will mean smaller overheads, less administration and an overall cost saving of as much as £5,900 in some cases.
‘This is money that could be reinvested back into the business for better marketing, trialling a new product, or increasing staff hours, for example.’
The changes are scheduled to be introduced from April 1st 2017. This is also when the next business rates revaluation takes effect; the process by which each commercial property has its rental value assessed by the Valuation Office Agency. This rental value is then used to calculate the business rates you pay each year on your bill.
The Valuation Office will publish its draft new values for each property on 1 October 2016 for consultation with local billing authorities, Rigby says.
When the next revaluation comes into force, some businesses will move outside of the £12,000 threshold for rates relief, and some will fall within it. This largely depends on the specific nature of your property and where in the country it is located.
Rigby advises that the Valuation Office Agency is responsible for valuing businesses and it will often request information from a business owner via a ‘form of return’. However, because there are so many properties to evaluate (some 1.8 million), it’s easy for the Valuation Office to make mistakes in this process.
‘Every ratepayer has the right to challenge their business rates bill at any time between revaluations. There is only one opportunity to do this however. Your chances of achieving success through an appeal, and therefore saving money, are improved if you get advice from professional, accredited surveyors.’
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