This is a common question at the moment and one that business owners are struggling to comprehend. Surely it’s the market rate today that sets all prices. Isn’t that how basic economics works?
Well not when it comes to Business Rates!
Broadly speaking the RV, set by the Valuation Office Agency (VOA), is based on rental value. However although by title it’s called the 2010 Rating list the figures used are those set and collated from 2008. Economic times back in 2008 were vastly different open market rents much higher.
As the RPS team have pointed out before, physical changes to your property and its locality can be reflected in a claim on Business Rates Relief, economic changes cannot.
On the horizon though is the 2015 revaluation that will reflect RV’s as at April 2013.
At RPS we support the British Property Federations (BPF) efforts to put in place a more equitable and accurate form on land taxation than a system that will always remain 5 years behind economic and business cycles.
If you are unclear as to how your Business Rates have been calculated and to see if they can be challenged they contact us to receive sound and clear property advice.