- A third of business owners unaware of changes to Business Rates in the Budget.
- 30% said the changes in business rates aren’t enough to help local businesses and high street shops.
- 66% feel local businesses add value to community.
Local businesses are the lifeblood of our high streets and during tough economic times they can often be neglected by the public who are looking for bargains, typically provided by the larger corporations.
Local Business Week, which runs from Monday 16th to Sunday 22nd May, is an annual campaign encouraging the public to buy more from their local businesses as well as giving local business owners access to advice and resources they can use to compete with the big guys.
There is a long list of hurdles that local businesses have to overcome. However in the most recent budget George Osborne announced the government’s plans to help the UK’s small businesses; from April 2017 businesses whose properties have a Rateable Value of up to £12,000 will not have to pay business rates at all, a rise from £6,000 previously. Property with a Rateable Value between £12,000 and £15,000 will receive tapered relief. Mr Osborne said the “typical corner shop in Barnstaple will pay no business rates at all”.
Despite this, a brand new survey, that comes from the Business Rent and Rates experts CVS, shows over a third (36%) of business owners are unfamiliar or unaware with the changes put in place by the government.
What’s more, 3 in 10 small business owners, with between 1-49 employees, said the changes in business rates aren’t enough to help local businesses and our high street. The amount that could be saved is up to £5,900 for those with a rateable value of less than £12,000 per annum.
Both large corporations and small businesses are able to have their property revalued by specialists, yet on 2% said they were aware this was even a possibility. Mark Rigby, Chief Executive at CVS Business Rates and President of Wasps Rugby Club, has provided advice around 5 key areas for any business owners:
What do the changes mean for local businesses?
“On the whole, the changes are very positive for local businesses. For many small firms, it will mean smaller overheads, less administration and an overall cost saving of as much as £5,900 in some cases. This is money that could be reinvested back into the business for better marketing, trialling a new product, or increasing staff hours, for example.”
When will the changes come into play, and what do I need to do beforehand?
“The changes are scheduled to be introduced from 1 April 2017. This is also when the next business rates revaluation takes effect – the process by which each commercial property has its rental value assessed by the Valuation Office Agency. This rental value is then used to calculate the business rates you pay each year on your bill.
The Valuation Office will publish its draft new values for each property on 1 October 2016 for consultation with local billing authorities.”
What about the regional differences, who gets the best deal?
“When the next revaluation comes into force, some businesses will move outside of the £12,000 threshold for rates relief, and some will fall within it. This largely depends on the specific nature of your property and where in the country it is located.
Business rates are currently based on rent levels assessed in 2008. So where rental levels have fallen since this time – such as for retail property in northern England – business rates will also fall. Where rental levels have increased – such as in London and the South East in particular – business rates are likely to go up.”
How can I have my businesses property revalued, and will it save me money?
“The Valuation Office Agency is responsible for valuing businesses and it will often request information from a business owner via a ‘form of return’. However, because there are so many properties to evaluate – some 1.8 million – it’s easy for the Valuation Office to make mistakes in this process. Every ratepayer has the right to challenge their business rates bill at any time between revaluations. There is only one opportunity to do this however. Your chances of achieving success through an appeal – and therefore saving money – are improved if you get advice from professional, accredited surveyors.”
I need further advice, who is best to speak to?
“Information and advice is available on the Valuation Office Agency website. But businesses interested in saving money on their business rates should speak to a firm of professional surveyors such as CVS.”
Small and medium-sized companies account for 99.9 percent of the UK’s businesses and over 66% believe that local businesses in their area add value to the community. A further 50% said local businesses are good for the economy, and 55% argued it was important to utilise their local shops where possible. They are a crucial part of the country’s economy and their success and survival depends on us all.
For more information on the changes to business rates go to www.cvsuk.com and support your high streets this Local Business Week.