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01 Feb

2017

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Advice

Preparing for 2017 in business rates

Posted by on 01 Feb 2017

2016 was a tumultuous year for a variety of reasons. There were the celebrity deaths, there was Brexit, and there was Trump. But for many small business owners, the most shocking, pressing development of the year could be the changes to the business rates system.

George Osborne promised “revolution” for business rates throughout his tenure as chancellor, but was dramatically sacked after David Cameron resigned, leaving his whole economic vision hanging in the balance.

While Osbourne’s replacement, Philip Hammond, kept quiet on the subject following his appointment, established business rates specialists, such as Gerald Eve’s Jerry Schurder, argued that businesses would be “hammered” by business rates if Osborne’s plans were to go ahead.

Simply through not cancelling them, Hammond brought Osborne’s plans into effect. However, he did reduce their impact by a miniscule amount in his Autumn Statement, concluding that a hike of 45% for some businesses would be too high, introducing instead a cap of 43%.

But this small change will do nothing to alter the fact that the next twelve months are set to be a business rates rollercoaster for small businesses and bigger firms alike. Here are three ways to make sure you are ready for the year ahead in business rates.

1. Check your new rateable values

Unbeknownst to you, the rateable values for your business premises may be set to increase by what seems like an extortionate amount when the new rateable values come into effect in April. Gerald Eve found that firms in London are faced with a combined bill of up to £7.5 billion more than the one they had last year.

The increase most businesses will face depends on the size of their premises and where they are based. Crucially, these increases will not come into effect until the start of the 2017/18 tax year. That gives businesses four months to budget for the new amount they have to pay each month.

Information on the 2017 revaluation can be found on the government website’s revaluation page. The page recommends contacting the Valuation Office Agency with details of your current rental agreement to ensure your new value has been correctly calculated.

To be even more helpful, the government have also released a new business rates calculator, preloaded with the latest ratings information, to allow you to figure out your new values for yourself.

2. Secure any vacant properties

On the other side of the business rates coin, you may be a landlord or business owner who happens to be sitting on an empty industrial property. Vacant business properties have always been subject to business rates, but with the 2017 revaluation there is every chance that you could end up paying more for your vacant lot to sit unused.

This being the case, there has never been a better time to ensure any vacant property is handled in such a way as to pay only the required business rates and nothing more.

There are measures that can be taken to minimize the payable business rates on empty properties. These include tightening the security of an empty property from vandalism, break-ins, theft, and squatters. Vacant industrial properties with better security are eligible for business rates relief.

3. Appeal for any relief or exemptions

A property doesn’t have to be empty to be eligible for relief from the national or local government. Appealing your business rates liability is an important part of the business rates process for any business owner or landlord who wishes to pay no more than their fair share.

As outlined by the government, there are several reasons your business may qualify for relief. Whether your premises is considered too small to cost the full amount (currently anything under £12,000); situated in a town with less than 3,000 residents; dedicated to charitable causes; or built on an enterprise zone, there may be a way to soften the increasingly heavy business rates blow to your business.

Small businesses in particular are in luck, as small businesses rates relief is more than doubling in 2017. For some, at least, the year will not be so bad.

Read more in these areas:

#National #economy #finance #government
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