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Challenging business rates can pay off for dealers

Dealers could save money on their business rates by challenging them if there has been a material change in circumstances (MCC) at the dealership or the area surrounding it.

MCC events can be permanent or temporary, internal or external but they all have one thing in common; they provide an opportunity to challenge the rating assessment of the premises affected by them.

Examples of MCCs where reductions in assessment (and rate liability) have been achieved include:

  • Disruption and disturbance caused by building works (including scaffolding) and roadworks
  • Physical changes to the property such as fire damage, demolition and alterations
  • Changes in the locality, for example new roads and shopping centres.

Alan Watson, Rapleys head of ratings, said: “Where the MCC is temporary (principally “disturbance” events such as building works or road works outside the property), the period and extent of the disturbance to the dealership is paramount and the shorter the period, the more severe the disturbance needs to be.

“Only in exceptional cases will works lasting less than three months qualify.”

Watson said that dealers looking to challenge the rates due to an MCC must do so as close to the start of the disruption as possible.

He said: “This is not something you can easily re-visit once the problem has finished as the valuation officer is reluctant to reduce assessments retrospectively. 

“If in doubt as to the extent and period of any disruption, it is best to lodge a protective appeal which can be withdrawn if necessary, at no cost.

“Finally the way in which a property is occupied/used should always be considered particularly when space isn’t being used to capacity.

"Internal layout changes and minor works may be worthwhile if they result in any vacant space being capable of a separate assessment for which empty relief will apply.”

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