What are Business Rates?
- Business Rates are a contribution to the cost of local services (such as Education, Social Services, Highways Maintenance, Street Lighting) provided by local authorities.
- The Business Rates collected by each Welsh local authority are paid to the National Assembly for Wales who give the income back to local authorities based on the population of each authority.
- Business Rates are paid by most non-domestic properties. The main exceptions are farm buildings and land, churches, and public parks.
- Where a property has both a domestic and non-domestic part (for example, a shop with living accommodation), it is known as a 'composite' property. In these cases, Business Rates are paid for the non-domestic part and Council Tax for the domestic part.
Business Rates are property based and are calculated by multiplying the property's rateable value by the rating multiplier (a rate in the pound). Rateable values are determined by the Valuation Officer (see Rateable values for more information), while the rating multiplier is set by the National Assembly for Wales. The rating multiplier is the same across the whole of Wales, although it is different from the rating multiplier in England which is set by the DTLR (Department for Transport, Local Government and the Regions).
The National Assembly for Wales sets the rating multiplier every year and it cannot by law rise by more than the increase in the Retail Prices Index (except in the year of a rating revaluation which takes place every five years).
Business rates bills may be reduced in certain circumstances, see Reductions to business rates.
Take care when obtaining advice on business rates - some operators are unqualified and will make fraudulent promises to secure large reductions in your rates bill - and charge you for their services. Once you've paid them you are unlikely to be able to seek redress, except through the courts, and an ill-considered appeal could even increase your rates bill.
When hiring a professional, always check the following claims:
- "We have a team of fully qualified professionals"
Do they? Check the firm and the individuals listed with the professional bodies listed in this document.
- "We have achieved big %%% reductions for several clients"
Demand the names and telephone numbers of past clients and ring them to check.
- "We can get huge %%% reductions on your property"
If they make these claims before making a full investigation of your property, they may be 'cowboys'.
- "You will have nothing to pay unless we succeed"
- Whatever their salesman may say, demand to see a copy of their contract
- Some contracts contain disguised fees. Do not believe stories that you will have to pay when the Valuation Office/Assessor in Scotland acknowledges receipt of an appeal. Not only are you able to lodge an appeal yourself, but the VO acknowledges receipt of all appeals free of charge
- Be careful if the contract entitles the firm to a percentage of the reduction in Rateable Value. This may not necessarily lead to a saving in the rates you have to pay
Professional advice from qualified rating surveyors is available from members of the Royal Institution of Chartered Surveyors (RICS) or the Institute of Revenues, Rating and Valuation (IRRV).
The members of these bodies are:
- regulated by rules of professional conduct offering redress to the general public
- fully trained and qualified to standards required by their professional body
- required to hold professional indemnity insurance
RICS will be able to provide you with the name of your nearest professionally recognised rating surveying firm who will provide you with up to half an hour's free advice.