BUSINESS RATES DISCOUNTS AND EXEMPTIONS
A CHANGE TO EMPTY PROPERTY RATESFrom 1 April 2011 the Government has reintroduced a lower threshold upon which empty property rates are payable. As from this date all properties with a rateable value of £2,600 (uprated in line with the general movement of property values at revaluation)
and above will pay 100% rates once the exemption period of three months (six months for qualifying industrial properties) has expired. Discounts and exemptions are available for Business Rates under certain circumstances:
UNOCCUPIED PROPERTY/EXEMPTIONSFull details of exemptions can be obtained from the Non Domestic Rates Team –
[email protected] or 01983 823 920.
EMPTY PROPERTIES
If your premises are empty, you may be exempt from business rates for a time.
Once a property is empty there will be a 3 month 100% exemption period. This is extended to 6 months in the case of certain industrial properties. At the end of this time, rates will be payable in full unless the unoccupied property falls into one of the exemption categories listed below.
The liability falls to the owner of the property i.e. the person who is entitled to possession and there is no new free period should the ownership change whilst the property is still empty. A new free period cannot be granted unless the property is reoccupied for at least 42 days.
Exemptions from Unoccupied Property Rates
For some properties a 100% exemption will apply until the property is reoccupied. These include:
- A property with a rateable value of less than £2,600.
- Properties owned by charities if the property's next use is likely to be wholly or mainly for charitable purposes.
- Properties owned by Community Amateur Sports Clubs if the property's next use is likely to be wholly or mainly for a sports club.
- Listed buildings.
- Ancient Monuments included in the Schedule of monuments compiled under section 1 of the Ancient Monuments and Archaeological Areas Act 1979
- Properties where the owner is prohibited by law from occupying it or allowing it to be occupied.
- Properties vacant due to action taken by the Crown or the local authority with a view to prohibiting the use or acquiring it.
- Properties where the person entitled to possession does so as a personal representative of a deceased person, a liquidator or trustee or where the owner is subject to bankruptcy proceedings.
Businesses that occupy a property, only trading on a seasonal basis at certain times of the year, would not qualify for relief during the closed period.
What if my property is in a poor condition and/or not capable of beneficial occupation?
If your property is not capable of beneficial occupation – for instance, if it is in poor condition and can not be economically repaired or, is undergoing major renovation works– you must approach the Valuation Office and request that the property be removed from the rating list altogether. In the meantime whilst the property remains in the local rating list the non domestic rates are due and payable.
SMALL BUSINESS RATE RELIEF
You may be entitled to a reduction of your Non Domestic Rate charge if your business occupies a Non Domestic Rated property with a Rateable Value of less than than £18,000. If you have more than one Non Domestic Rated property you may still be eligible to this relief if:
- All other properties have a Rateable Value of less than £2,600 each and
- The Rateable Value of your main property plus all other properties totals less than £18,000
Small Business Rate Relief will only be granted to your main property - the one with the highest Rateable Value.
Empty properties do not qualify for Small Business Rate Relief.
Ratepayers in receipt of mandatory charitable rate relief or rural rate relief do not qualify for Small Business Rate Relief.
- Properties with a rateable value below £6000 receive a 50% reduction on the Non Domestic Rate charge. This will decrease on a sliding scale by 1% for every £120 rateable value between £6001 and £11,999.
- Properties with a rateable value between £12,000 and £17,999 will not receive an additional rate reduction, but will pay rates based on the lower multiplier of 42.6p (rather than 43.3p).
Should your circumstances change, such as occupation of an additional property or an increase in Rateable Value, you must notify us within 4 weeks or you could lose your relief entitlement.
It is a criminal offence to provide false information when applying for Small Business Rate Relief. If you do so you could be fined, imprisoned or both.
Temporary Increases to Small Business Rate Relief
1 October 2010. (Extended to 31 March 2013)
- Eligible ratepayers with properties with rateable values of £6000 or less will receive relief at 100%.
- Eligible ratepayers with properties with rateable values between £6001 and £12,000 or less will receive a tapered relief between 100 per cent and 0 per cent.
Eligible businesses will need to take no action to benefit from the increased relief.
Businesses who are eligible but are not currently claiming the relief can apply to join the scheme by completing an application form. There are no changes to the eligibility criteria for Small Business Rate Relief.
CHARITABLE AND DISCRETIONARY RELIEFCharities are entitled to relief from Business Rates on any non-domestic property, which is wholly, or mainly, used for charitable purposes:
Mandatory Relief is given at 80% of Business Rates.
Charities can also apply for Discretionary Relief where the Council can remit all or part of the remaining 20% of the Business Rates bill.
The Council is also permitted to grant relief of up to 100% to certain non-profit making bodies who are not entitled to Mandatory Relief.
The council’s discretionary rate relief policy is currently under review due to changes in legislation under the Local Government Finance Bill and the Business Rate Retention Scheme which comes into effect from 1
st April 2013. This will affect the current award of discretionary rate relief you are eligible for,
COMMUNITY AMATEUR SPORTS CLUBWith effect from 1
st April 2004 the Charity Commissioners now also recognise most community amateur sports clubs as charitable. Sports clubs will need to be registered with the Inland Revenue and make their facilities available to all members of the public for improving health and fitness. Guidance notes can be viewed at
www.charity-commission.gov.uk or by telephoning 0870 333 0123.
VILLAGE SHOP AND RURAL RATE RELIEFVillage Shop or Rural Rate Relief is also available. The only general store who sell food for human consumption or post office, with a rateable value (from 1
st April 2010) of less than £8,500, in a designated rural settlement, is entitled to a 50% reduction in rates payable. The only petrol station or public house, with a rateable value (from 1
st April 2010) of less than £12,500, in a designated rural settlement, is entitled to a 50% reduction in rates payable.
HARDSHIP In very exceptional circumstances the council may allow relief on a rates bill in cases of hardship. When deciding whether to award relief the council must take into account many factors, including the benefits which the business provides to the local community.
Criteria and conditions Section 49 of the Local Government Finance Act 1988 gives a billing authority power to reduce or remit the amount of Business Rates payable on a property provided that it is satisfied that:
- the ratepayer would sustain hardship if the authority did not do so; and
- it is reasonable for the Authority to do so, having regard to the interests of persons subject to its Council Tax.
Who is eligible for Hardship Relief
Hardship Relief may be awarded to a limited company as well as to an individual, or groups of individuals in the case of partnerships.
A ratepayer may make application for Hardship Relief whether they are subject to either occupied rates or empty property rates.
All relevant factors affecting the ability of a business to meet its liability for rates should be taken into account.
The 'interests' of council tax payers may go wider than direct financial interests. For example, where employment prospects in the area would be badly affected by a company going out of business, or where the amenities of an area would be severely affected, for instance, by the closure of the only shop in a village.
In order for the council to consider granting hardship relief, an application must be made in writing, including copies of fully audited accounts.
Any specific application for discount is referred to the Cabinet Member for resources, under their delegated authority, and decision is made on the merits of each case.
Section 44A Relief
Where part of a property is unoccupied for a short time, the Council can ask the Valuation Officer to apportion the Rateable Value of the property between the occupied and unoccupied parts. The empty part will receive complete exemption for three months (or six for an industrial property). After the initial rate-free period expires the occupied business rate will apply to the whole property.
If you wish to apply for part unoccupied rates please send an A4 plan of the property as soon as the area has been cleared highlighting the “empty” areas for which relief is requested to the Non-Domestic Rates (Business Rates) Section.
Completion notices for new buildings
The purpose of a completion notice is to establish the date from which a new building is to be treated as completed for the purpose of unoccupied property rating. It does not establish the date from which liability to pay empty property rates starts, it serves to establish the day from which the three or six month period of exemption starts.
The law requires the Council to issue a completion notice for a newly erected building as soon as it comes to our attention that the work remaining can reasonably be expected to be completed within three months. A completion notice may be served on the whole of a building or part of a building.
The completion notice will show the date on which the Council considers the building could reasonably be completed. If you do not agree with the completion date you should write to the Council immediately. We will try to come to an agreement with you, but if agreement cannot be reached you may appeal to the local
Valuation Tribunal. How to contact usTelephone 01983 823920 – Lines are open between 8.00 am – 6.00 pm Monday – Friday
E-mailE-mail:
[email protected] Fax01983 823900
Write toIsle of Wight Council
Revenues Division
Council Offices
Broadway
Sandown
Isle of Wight
PO36 9EA
Opening Times: 8.30 am – 5.00 pm Monday, Wednesday, Thursday and 8.30 am – 4.30 pm Fridays.
Closed all day Tuesday