Warning over business rates cold callers

MANCHESTER businesses could actually face higher costs if they fall for boiler house telesales claims that business rate appeals will always save money, says a specialist in the sector.
 
As the deadline of March 31 for submitting business rate appeals set in the Autumn Statement looms there have been increased reports of firms encouraging business rate appeals with the line ‘use it or lose it’.
 
Andy Crossley, a partner and business rates expert based in the Manchester office of consultancy Gerald Eve, which advises 25% of the FTSE 100 on property taxation, said: “We suggest companies treat with caution these telesales approaches over the coming weeks. Cold callers have a track record of promising reduced assessments but leaving their clients with increased bills when the Valuation Office realises the rateable value appealed was too low”.
 
“There is no purpose in appealing without the prospect of achieving a saving and only harm can arise from challenging a low valuation, which might encourage the Valuation Office to increase and backdate the assessment,” warned Crossley. “Nonetheless, where an appeal is merited and a business is satisfied that there is no risk of an increase, then a challenge should be made before the end of March deadline. Use it – yes – but don’t abuse it.”
 
Gerald Eve says it has saved its clients in excess of £1.55bn from business rates appeals related to the last business rates revaluation in 2010.
 
In his Autumn Statement the Chancellor George Osborne heralded that the Valuation Officers’ rights to backdate increases in business rates would be curtailed from April 2016. However there was a catch. New restrictions have been imposed on appellants and unless formal appeals are made by March 31, any consequential rateable value reductions will not be backdated.
 
For a property already in assessment by March 31, ratepayer appeals should be made by March3 1 for the reduction to be fully backdated, potentially to  April 1 2010. If an appeal is made after March 31 the earliest any reduction can normally be backdated to is April 1 2015.