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2020 – a year of change for business rates
2020: A year of constant change for Business Rates, explains Colin Hunter of Lambert Smith Hampton.
In January, the long-awaited decision of the Upper Tribunal in respect of Royal Albert Memorial Museum (Stephen g Hughes (VO) v Exeter City Council) was given (the Exeter decision). A victory for the ratepayers, and some would say for common sense, the decision confirmed a Rateable Value of £1 for Royal Albert Memorial Museum and fully upheld the 2017 decision for appeals in respect of properties occupied by York Museums and Gallery Trust.
In February ,the Valuation Officer sought permission to appeal against the Upper Tribunal’s decision and a Bill to confirm the 2021 Revaluation was set before Parliament (again). That Bill has been allowed to fall away, with an announcement that the next Revaluation has been put back to 2023.
In March, the Budget included a 50% rates relief for 2020/21 for Retail and expanded the scheme to include museums and other leisure and hospitality properties with a Rateable Value of less than £51,000. In response to the Covid-19 pandemic, that allowance was soon increased to 100% with no upper limit on the size of Rateable Value. Grants were announced for properties within the rates relief scheme (capped at Rateable Value of £51,000). The scheme was later extended to include discretionary grants, benefiting some museums not previously covered.
In June, the Court of Appeal dismissed the Valuation Officer’s attempt to appeal the Exeter decision.
In July, the Valuation Office issued revised guidance to its staff for the valuation of museums. This new guidance takes on board some of the findings of the Upper Tribunal decisions but still leaves open the question of how to value modern purpose built museums and galleries. As they were not consulted on this guidance, AIM and other sector bodies have approached the Valuation Office and continue to seek the opportunity to discuss the best way forward.
The backlog of over 230 appeals for the 2010 List in England and Wales should be cleared by the end of this financial year and appeals in process for the 2017 Rating List should start to be discussed, if not agreed. Based on the decision published in January, there should be some significant reductions in Rateable Values resulting in refunds from the 2010 appeals going back at least five years.
So, as we slowly come out of lockdown and start to return to some semblance of normality, it is time to start looking forward again. The 2017 Rating List expected to end on 1 April next year will now run for another two years. The Valuation Office will not be reactively reducing Rateable Values for museums, so now is the time to think again about whether or not the assessment for your museum is right and whether there are savings to be made in this fixed and unavoidable cost, and perhaps even get some refunds back-dated to 1 April 2017.
Colin has updated AIM’s Success Guide on business rates to reflect the changes from the last few months. Read the latest Success Guide here.
As ever, it is advisable to take professional advice before embarking on any appeals not least as the Rateable Value can be increased if it has been under-assessed. If you are interested in finding out more, Colin Hunter of Lambert Smith Hampton has agreed to provide AIM members with a minimum of 15 minutes free consultation. You can contact Colin on 0113 245 9393 or firstname.lastname@example.org. email@example.com.