As business owners seek to find efficiencies where they can, one of the main areas to look at is business rates. For some companies this will be the second most expensive outgoing after rent and mortgage payments.
The Valuation Office published a draft list last Autumn, in advance of the 2015 Rating List going live in April 2017. Forge Property Consultants are advising all occupiers of commercial properties to check their draft assessments for the 2017 list, and also the current assessments for the 2010 list very carefully.
Forge Property Consultants’ Charles Lawson says, “It is quite common for mistakes to be made by the Valuation Office. Recent examples have included errors in measurement and an over reliance on the rent paid as being a true indication of Market Rent. In reality, rents are agreed for commercial reasons and might include a value attributed to a bespoke fit out, or other specific set of circumstances. The only way of accurately assessing the Market Value on which rateable value is based is by undertaking a detailed analysis of comparable evidence.”
Charles has recently been working on behalf of a client in Wrexham who was concerned about the amount being charged. In negotiation, the rateable value on part of the building has now reduced by a staggering 84%. This resulted from a vastly overstated area and excessive multiplier being applied. Charles comments, “Although this is one of the most extreme examples we have come across it does demonstrate just how wrong these assessments can be. Occupiers have tended to assume that the Valuation Office, being a professional valuation agency, always gets it right – which sadly is not the case. We would urge all occupiers of business premises to check everything to do with their business rates assessment very carefully and get in touch with us, or another professional, if they are concerned.”