By Altus Group | December 3, 2019

Nearly 120,000 non domestic properties in England have taken steps to formally appeal their business rates bills since the controversial revaluation came into effect on 1st April 2017 with outstanding ‘Challenges’ up 35% fueling concerns that the new system was now creating a “bottleneck”.

Rateable Values, which are an estimate of a property’s annual rent on 1st April 2015 and came into effect on 1st April 2017, form the basis of the tax calculations for business rates bills.

Data from the Valuation Office Agency, an Executive Agency of HM Revenue & Customs, shows that 118,390 non domestic properties in England from shops to restaurants to pubs to public sector buildings registered a ‘Check’ between 1st April 2017 and 30th September 2019, the first stage of a formal appeal under the new Check Challenge Appeal Regulations.

The data also shows that, since the revaluation came into effect on 1st April 2017, up to and including 30th September 2019, a total of 109,610 ‘Checks’ in England were resolved with 67% of those ‘Checks’, 73,620 in total, being either agreed or partially agreed culminating in tax rebates.

However, for those premises where issues could not be agreed at the ‘Check’ stage, under the new 3 stage process, those formal appeals moved to the ‘Challenge’ stage with 12,580 non domestic premises as of 30th September 2019 now waiting for their cases to be resolved up 35% from 9,260 since the end of June 2019.

Once a ‘Challenge’ has been made, 18 months is allowed in law for a response before a business can take their case to the Independent Valuation Tribunal.

Of the 12,580 ‘Challenges’ outstanding as of end of 30th September a total of 3,190 are from premises across the 32 boroughs of London and the City – around 1 in 4.

Businesses across London were adversely impacted under the Revaluation in 2017 with the average property across the West End of London this year paying 35.99% more in rates bills than in 2016/17, the final year before the revaluation came into effect, according to Altus Group.

Alex Probyn, President of UK Expert Services at Altus Group, said: “More Checks are now being resolved than received which, in isolation, is positive, but my real and continued concern is the unnecessary delays that are being created by the increasing bottleneck at the Challenge stage.

“If more Challenges continue to be received than resolved and the settlement rate does not significantly improve, then this situation will become chronic. It will also mean that far too many cases will clog up the independent Valuation Tribunal, which is exactly what the new system was designed to circumvent.  This is still salvageable but more resource must be found now, and the next Government must look to change the law to reduce the maximum response from 18 months to 6 months so that meritorious cases are resolved quickly”.

John McDonnell says a future Labour Government would “guarantee a fair and transparent appeal process” adding “case after case appeals have gone on far too long and then we are left mystical by the decision.”

The Ministry of Housing Communities and Local Government have confirmed that they expect Councils in England to collect £25 billion in business rates this year.


John McDonnell at FSB hustings  – 5 minutes 30 seconds



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