Many businesses are unknowingly overpaying their business rates every year. Why is this? It all comes down to whether your Rateable Value is correct and that depends on the VOA holding accurate information about your property details.
For the VOA to calculate your RV accurately they would need to visit and gather all the information about every property, during the time of the valuation date. This is extremely hard to do and so they make informed estimates instead.
Every property that is used (or partly used) for commercial purposes will be required to pay Business Rates, also known as Non-Domestic Rates. This form of tax is charged on properties such as offices, dental surgeries, shops, pubs, warehouses and factories.
Business rates are calculated by HMRC’s Valuation Office Agency (VOA) using the following formula:
Rateable Value X Multiplier = Business Rates
Firstly the VOA will set a Rateable Value (RV) for your property. This is determined by estimating the property’s value on the open market at a given date.
E.g. A property valuation date was last set on 1st April 2017. A revaluation usually happens every 5 years.
Next, your RV is then multiplied by a ratio set by the Government, known as the Multiplier. The Government sets two Multipliers; one for small businesses (RV below £51,000) and one for other businesses (RV of £51,000 and above).
Once you know your RV, select which Multiplier is relevant to you and you can calculate your Business Rates.
RV x Small Business Multiplier = Your Estimated Business Rates
Or
RV x Standard Business Multiplier = Your Estimated Business Rates
But we are not finished yet. Your business may be entitled to certain business rate relief such as Small Business Rate Relief, Transitional Relief, Rural Rate Relief, etc. If you qualify for any of these you will need to deduct them from your business rates estimate.
RV x Multiplier – Relief = Business Rates
Find out if you can reduce your business rates with one of our experts.
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We have helped many businesses reduce their business rate bills to almost zero rates.
Mistakes frequently occur in property assessments, so if you have received your business rates bill it is very possible that you could reduce it. Consider the following:
If you’ve answered yes to any of the above or you believe there is another circumstance that may have affected whether your property has been fairly valued, then it’s time to check your business rates.
Find out if you can reduce your business rates with one of our experts.