Business rates are determined based on the value of your property multiplied by an applicable poundage rate set by the Scottish government. A number of relief schemes exist to lower this bill.
Calls for reform have become a regular theme among retailers seeking to compete with online rivals that incur lower tax costs, particularly retailers tasked with competing against online marketplaces with lower tax costs. But when the Non Domestic Rates Bill reached committee stage in parliament, an unexpected amendment by Green MSP Andy Wightman caused quite an uproar.
Rateable Value
Your business rates payments depend on the value of your non-domestic property as determined by assessors in a process known as “revaluation”. Revaluations is performed every five years to produce a new rateable list and generate business rates payable.
Rateable values are meant to represent what a reasonable landlord could expect to earn from renting out their building, yet revaluations often results in increased business rates bills; “transitional arrangements” are implemented to lessen this impact.
At WYM Rating, our aim is to secure our clients the lowest possible business rate liabilities. From single properties or portfolios alike, our experts will review valuations, provide up-to-date rental evidence, and advise on whether an appeal would be successful; even where there has already been revaluation.
Small Business Bonus Relief
As a small business, you could qualify for relief on your non-domestic rates bill based on its total rateable value and whether or not it’s occupied or empty property. Please refer to the table below for current relief amounts available.
As of 1 April 2023, qualifying for Small Business Bonus Scheme relief requires your property being occupied, as the scheme has been revamped. Up until that point in time, however, transitional relief will be introduced in order to limit increases in rates liability from 2023-2024 revaluations processes.
Complex issues have long been the source of industry debate. While it’s easy to identify how rising rates bills are harming Scotland’s economy, it can be more difficult to gauge their effect on jobs, investment or growth due to data quality challenges, identification of businesses and policy implementation (where properties cluster around policy thresholds), making it hard to get an accurate view on whether policies implemented are effective or unfair.
Appeals
The 2023 Rating Revaluation will offer another opportunity for homeowners and landlords alike to challenge their Rateable Value, yet the process has changed substantially this time around. The Scottish Government has brought forward legislation which fundamentally alters how such challenges may be lodged.
With new bills set to take effect in April, property experts are concerned that business owners won’t have enough time to assemble an evidence dossier in support of their proposals. Ken McCormack from Montagu Evans warned that the delay in implementing regulations to revamp the old appeals process will provide businesses with very little opportunity to challenge their bills.
Business rates generate nearly PS3bn annually but are widely seen as an expense to those investing in our towns and cities. Calls for reform – often from retailers competing against online competitors with lower overhead costs – are frequently heard but usually met with polite silence from politicians in Westminster and Holyrood.
Proposals
2023 will see all commercial properties being revalued on one date to ensure consistency and fairness, with their new values used to calculate rates – this differs from assessing individual property values which can be affected by multiple factors.
Your property’s rateable value will determine how much in business rates you owe; then this figure is multiplied by a set rate to produce your bill – this property tax does not relate directly to profit or any other measure of success.
At this revaluation, the Scottish Government is introducing legislation that will drastically alter the appeal process. This requires much more detailed documents, while Assessors still retain their right to reject proposals which don’t meet legislative requirements. We can assist in creating these documents and making sure your proposal satisfies them all – whether you own single properties or portfolios we will ensure your proposal satisfies them all! Contact us for further details or inquiries about working together towards reaching a successful result for your business.
