BUSINESS: Business rates – what you need to know (From News Shopper)

BUSINESS: Business rates – what you need to know

10:28am Tuesday 15th December 2009 in FSB News Column By Hannah Holdroyd, Federation of Small Businesses

Every business owner should be aware that they will probably need to pay business rates, based on the value of the business or non-domestic property that their business is located in.

Business rates are assessed and set by central government, collected by local government and then passed back to central government for reallocation to pay for various government projects.

Business rates are the third biggest outgoing for businesses, after wages and rent, so making sure you are not paying more than you should can make a really big difference to a business.

You may be aware that the government has recently re-evaluated business rates, and this will affect the rates you pay from April 1, 2010.

They should have written to you by now with details of your revaluation, but if you are unsure you can visit the website of the Valuation Office Agency at voa.gov.uk to find out more about your rateable value.

Once you know the new rates for your business, you may not agree with them, you may think they have been sent too high. In this case you may not be aware that you are entitled to appeal the rates that have been set. You can do this by first contacting your local Valuation Office Agency, and if you are still not satisfied, lodging a formal appeal.

Details of your local office and copies of the appeal forms can be found on the Valuation Office Agency website.

It is also worth being aware of your entitlement to small business rate relief. If you are located in one property and have a rateable value of less than £21,499 in London, or £10,001 - £14,999 elsewhere you are most likely entitled to a relief, although the amount will depend on your actual rateable value.

This will be increasing from April 2010 to £17,999 for properties outside of London, and to £25,499 in Greater London.

The good news is that whereas before you had to reapply each year, you will not have to do this for 2010.

You are however obliged to inform the local authority you pay your rates to if you think you are no longer eligible. If your rateable value changes and you are still eligible, your local authority will automatically assess the relief amount.

Other rate reliefs include empty property rate relief and rural rate relief, and you can find out more information about these from sources such as Business Link at businesslink.gov.uk

For businesses located in London, the rateable value of the business is more important than ever due to the Business Rate Supplement (BRS) being introduced from April 1, 2010 by the Mayor of London.

This supplement is to help pay for the Crossrail project and is to be paid by all businesses with a rateable value more than £50,000.

You may therefore have assumed it won’t apply to you, but upon the re-evaluation have found that it does. This means it is really important that you know what you are paying, and if you’re not happy, you do something about it.

Business rates are a large and unavoidable expenditure for most businesses so it’s really important to make sure you are not too much or missing out on relief you are entitled to.

Hannah Holdroyd is the London policy officer for the Federation of Small Business, the UK’s leading business organisation. She can be contacted at hannah.holdroyd@fsb.org.uk