Still time to claim business rates rebates

The deadline for reclaiming overpaid business rates is fast approaching with accommodation business owners having until 31 March to file their claim for the past five years.

Manchester-based Commercial Valuers and Surveyors (CVS) estimate that on average hoteliers are paying about 13% too much on their business rates each year, and yet not many of them know that they can challenge these rates.

According to CVS figures, 13,492 hotels were assessed during the Ratings Lists in 2005 (date of the last revaluation), which produced a total rateable value liability of £947m. Effectively, this means that successful appeals could result in savings of over £21,000, according to CVS.

This is due to the Valuation Office Agency’s practice of taking a percentage of hotel takings as basis for the rating assessment, which, according to CVS, is flawed. This means that hoteliers at the moment could be taxed on the levels of service, the type of furniture and fittings and their expertise, rather than on the rental values from April 2008 (and not before), when the economic crisis hit, impacting on property rental values.

Business rates revaluations occur every five years and the next one is due on 1 April this year, with rates expected to be reduced for almost two out of three businesses. This means that from this date it will be much more difficult – if at all possible – to claim the rebates for the past five years.

More information can be found on the Valuation Office Agency's website, including the draft rateable value of your property from 1 April, as well as a tool to check the rateable value of your property up to 31 March 2010.