Business rates set to rise in Rochdale despite rateable values falling

Mark Rigby, CEO of CVS

Business rates across Rochdale are set to rise next April despite falling property assessments, say rent and rates specialists, CVS.

The Government has now adjusted the rateable values of every business property in England and Wales to reflect changes in the property market. The new rateable value will be used to determine the basis of the tax calculation for rates next April.

The revaluation of business properties usually happens every five years but was controversially delayed by two years as a result of the economic downturn. The last revaluation came into effect on 1 April 2010 based on the property market as long ago as 1 April 2008.

However, new rateable values recently published show that across Rochdale, total rateable values have fallen by £2.22million according to a detailed analysis from CVS.

Their analysis shows that Rochdale’s 6,903 businesses had a combined rateable value of £169,033,884 based on the last property assessment in 2010, which has formed the basis of rates bills for the last seven years, but this has just decreased to £166,809,902.

As a result, CVS project that next year, despite the falling property values, an additional £180,072 in tax will still be added to Rochdale’s overall rates bill which is likely to rise to £83.79million.

The Government is currently consulting on a scheme called 'transitional relief' that will phase in large reductions in rates bills which will mean any large reductions will be phased in but will be limited to 4.1% for large businesses and 10% for medium sized businesses next year.

Mark Rigby, CEO of CVS, said: “The new rating list on the face of it is a good bit of news for businesses in Rochdale.

“The previous business rates assessments took effect just as the financial crisis turned the property market on its head. That meant that over the last seven years, businesses in Rochdale have effectively been paying more than they should have been.

“However, the Government’s proposals for transitional rates relief mean that those businesses expecting lower bills will be dismayed and disappointed that reductions in rates payable will be gradually phased in.”

Businesses are advised to seek professional advice as to whether they are paying the correct amount in business rates. The Government’s changes to the business rates appeals process means that there is now a three-stage process known as ‘Check. Challenge. Appeal.’ (CCA) for the property’s new assessment.

The CCA process is intended to manage the flow of cases through the system in a structured and transparent way, and each step must be fully completed in sequence to submit an appeal.

Nearly three quarter of a million businesses in England and Wales challenged their last assessment with almost one in three receiving a rebate.

Mr Rigby added: “It is essential that businesses across Rochdale consider a thorough check of their new tax assessment as there may well be scope for an appeal.”