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Business rates - general information

Last Modified April 08, 2014
 

National non-domestic rates

Non-Domestic Rates, or business rates, collected by local authorities are the way that those who occupy non-domestic property contribute towards the cost of local services. Under the business rates retention arrangements introduced from 1 April 2013, authorities keep a proportion of the business rates paid locally. This provides a direct financial incentive for authorities to work with local businesses to create a favourable local environment for growth since authorities will benefit from growth in business rates revenues. The money, together with revenue from council tax payers, revenue support grant provided by the Government and certain other sums, is used to pay for the services provided by your local authority and other local authorities in your area. Further information about the business rates system, including transitional and other reliefs, may be obtained at on the GOV.UK website.

The scheme allows local authorities to keep 50% of business rates income including growth. You can find out more about these changes in the Plain English Guide to Business Rates Retention.

Together with revenue from council taxpayers, revenue support grant provided by the government and certain other sums, business rates revenue is used to pay for the services provided by us and other local authorities in your area.

Changes to Business Rates announced in the December 2013 Autumn Statement

The chancellor of the exchequer announced the following changes to business rates in the December 2013 autumn statement:

  • The government capped the Retail Price Index increase in business rates at 2% for 1 year from 1 April 2014.
  • The government introduced a business rates discount of £1,000 for retail and food and drink premises with a rateable value below £50,000 for 2 years up to the state aid limits from 1 April 2014. Most qualifying ratepayers saw this discount included on their 2014-15 rate demands. For more information, go to the business rates reductions and reliefs page.
  • The government introduced a 50% business rates relief for 18 months up to the state aid limits for businesses that move into retail premises that have been empty for a year or more. Businesses which move into empty premises between 1 April 2014 and 31 March 2016 will be eligible for the relief. Contact revenues@hertsmere.gov.uk or call 020 8207 7409 for more information.
  • (The government had already announced that with effect from 1 October 2013 any newly-built hereditaments that remain unoccupied will receive exemption from rates. The scheme will end in September 2016).
  • The government extended the doubling of Small Business Rate Relief for a further year from 1 April 2014.
  • The government relaxed the Small Business Rate Relief rules to allow businesses in receipt of Small Business Rate Relief taking on an additional property to retain Small Business Rate Relief on the first property for 1 year, with effect from 1 April 2014.
  • The government has allowed businesses to pay business rates over 12 months rather than 10 months, with effect from 1 April 2014. Information about this can be found on the reverse of your rates bill. Alternatively contact revenues@hertsmere.gov.uk or call 020 8207 7409 for more information.

Rateable value

Apart from properties that are exempt from business rates, each non-domestic property has a rateable value, which is set by the valuation officers of the Valuation Office Agency (VOA), an agency of Her Majesty's Revenue and Customs. 

It draws up and maintains a full list of all rateable values: Valuation Office Agency. The rateable value of your property will be shown on the front of your bill. The rateable value broadly represents the yearly rent the property could have been let for on the open market on a particular date. This date has been set as 1 April 2008.

The valuation officer has to maintain the list and may alter the value if he or she believes that the circumstances of the property have changed. The ratepayer (and certain others who have an interest in the property) can also appeal against the value shown in the list if they believe it is wrong. Further information on the grounds for making an appeal, and on how to make one, can be found on the Valuation Office Agency website or from your local valuation office.

If your rateable value changes as the result of your appeal, and the amount you have to pay is altered because of this, we will send you a revised bill.

In the meantime you must keep up your payments as shown on your original bill.  If you don't, we will take recovery action against any arrears that build up. We will refund, with interest, any difference between the amount you have already paid and any reduction resulting from a successful appeal, but we will not pay interest if a liability order has been issued against you.

The effect of successful appeals against values shown in the rating list will normally be backdated to the beginning of the financial year in which they are made, although there are exceptions to this.  Further information about these arrangements may be obtained from the Department of Communities and Local Government .

National Non-Domestic Rating Multiplier

The local authority works out the business rates bill by multiplying the rateable value of the property by the appropriate multiplier. There are two multipliers; the standard non-domestic rating multiplier and the small business non-domestic rating multiplier. The former is higher to pay for small business rate relief. Except in the City of London where special arrangements apply, the Government sets the multipliers for each financial year for the whole of England according to formulae set by legislation. Between revaluations the multipliers change each year in line with inflation and to take account of the cost of small business rate relief. In the year of revaluation the multipliers are rebased to account for overall changes to total rateable value and to ensure that the revaluation does not raise extra money for Government. The current multipliers are shown on the front of your bill.

Revaluation 2010 and Transitional Arrangements

All rateable values are generally reassessed every five years at a general revaluation to ensure bills paid by any one ratepayer reflect changes over time in the value of their property relative to others. The current rating list is based on the 2010 revaluation. The next revaluation has been postponed by the Government until at least 2017 to provide greater stability for businesses to encourage economic growth. Five yearly revaluations will continue from 2017. Revaluation does not raise extra money for Government.

 For those ratepayers who would otherwise have seen significant increases in their rates liability, the Government put in place a £2 billion transitional relief scheme to limit and phase in changes in rate bills as a result of the 2010 revaluation. To help pay for the limits on increases in bills, there were also limits on reductions in bills. Under the transition scheme, limits continue to apply to yearly increases and decreases until the full amount is due (rateable value times the appropriate multiplier). The scheme applies only to the bill based on a property at the time of the revaluation. If there are any changes to the property after 1st April 2010, transitional arrangements will not normally apply to the part of a bill that relates to any increase in rateable value due to those changes. Changes to your bill as a result of other reasons (such as because of changes to the amount of small business rate relief) are not covered by the transitional arrangements. The transitional arrangements are applied automatically and are shown on the front of this bill. More information on revaluation 2010 can be found on the Valuation Office Agency website.

For more information about the above visit the GOV.UK website.

Hertsmere Connect

Hertsmere Connect is a joint venture between Hertsmere Borough Council and Watford & West Herts Chamber of Commerce to:

  • generate greater engagement between local Hertsmere businesses
  • to support the retention and development of existing businesses
  • encourage inward investment by new businesses into Hertsmere

Hertsmere Connect aims to be a powerful, independent voice for a vibrant business community, committed to optimising the benefits and opportunities for all our members. Their business is to enable your business to grow by providing a wide range of events and services.

With the challenges and demands facing businesses in an uncertain economic climate, Hertsmere Connect has a vital role to play. They aim to be active in every walk of business life, encouraging relationships between companies, working to improve prosperity across Hertsmere area.

Visit the Hertsmere Connect website, e-mail info@watford-chamber.co.uk or call 01923 442442 for more information.

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