Insights

Budget Changes and Business Rates Impact

The recent Autumn Budget for 2024 introduced significant changes to business rates, with substantial implications for businesses across various sectors. As a business owner, it’s essential to understand how these changes may affect your financial planning and what steps you can take to prepare.

Key Budget Highlights for Business Rates

• • Reduced Relief for Retail, Hospitality, and Leisure (RHL) Businesses: The relief rate for RHL businesses will decrease from 75% to 40% in the upcoming financial year, capped at £110,000 per business.
• • Permanent Lower Business Rates for Smaller RHL Properties: A reduced business rate multiplier will be introduced for RHL properties with rateable values under £500,000 starting in 2026-27.
• • Higher Multiplier for Large Properties: Properties with an RV over £500,000 will experience an increased multiplier to balance reduced rates for smaller RHL businesses.
• • Multiplier Freeze for Small Businesses: The small business rate multiplier is frozen at 49.9p for 2025-26, aiding over a million small properties.
• • Removal of Charitable Rate Relief for Private Schools: Starting in April 2025, private schools will no longer qualify for charitable rate relief.

How to Prepare for These Changes

With these changes in mind, businesses should ensure their rateable values are accurate and that they qualify for the correct reliefs. For RHL businesses, it’s essential to adjust financial plans to accommodate reduced relief levels and to stay informed about government long-term business rate reforms.

As business rates become increasingly complex, reaching out to experts who can help guide you through the changing landscape can be invaluable. Our consultancy specialises in securing the best possible outcomes for your business rates, ensuring compliance and potential savings in light of the new regulations.

Strategies to Manage Rising Business Rates and Mitigate Costs

The evolving business landscape in the UK has seen significant adjustments in business rates, placing financial strain on many sectors. Understanding business rates has become more complex than ever. This article outlines effective strategies to help businesses manage rising business rates and mitigate costs effectively.

1. Understand Your Rateable Value

Rateable Value (RV) is a crucial component in calculating business rates. It represents the estimated annual rent for your property on the open market. Regularly reviewing your RV is essential. If it’s inaccurately high, consider appealing it with the help of a business rates consultancy.

2. Apply for Available Reliefs

Several reliefs are available to businesses that can substantially reduce your business rate liabilities:

• • Small Business Rate Relief (SBRR) - Up to 100% relief for eligible small businesses.
• • Retail, Hospitality, and Leisure (RHL) Relief - Currently 75%, dropping to 40% in the upcoming fiscal year.
• • Rural Rate Relief - Up to 100% relief for businesses in rural areas.

3. Leverage Temporary Reliefs and Government Incentives

The UK government often introduces temporary reliefs to support specific sectors. Monitor these, as they could offer significant savings, such as the recently introduced 49.9p freeze on the small business rate multiplier.

4. Consider Occupancy Strategies

Business rates apply only to occupied premises. If you have vacant spaces, consider temporary exemptions for unoccupied properties to reduce your rates bill.

5. Engage in Strategic Planning for Rate Revaluations

Business rate revaluations occur periodically, adjusting RVs based on recent property market trends. Working with a business rates specialist can help you anticipate these changes and strategise accordingly.

6. Engage in the Check, Challenge, Appeal (CCA) Process

The CCA process is the official procedure for disputing your rateable value. Working with an experienced business rates consultant can make navigating this process more efficient and improve your success rate.

7. Consider Outsourcing Business Rates Management

Business rates can be complex and time-consuming. Outsourcing rates management allows you to focus on your core business while ensuring maximum cost efficiency.

Conclusion

Business rates are a significant and unavoidable cost for most UK businesses. However, proactive management, strategic planning, and maximising available reliefs can help minimise this financial burden. Partnering with a business rates consultancy ensures you’re well-prepared to face rising rates with confidence.

Navigating Business Rates Amidst a Challenging Climate for Car Dealerships

As car dealerships across the UK face an increasingly challenging landscape, the latest pressures from a credit crunch add yet another dimension to the struggle. High business rates, combined with shifting consumer financing dynamics, are impacting profitability and cash flow for many dealerships. In this article, we’ll explore the impact of these challenges and provide insights on strategies that dealerships can adopt to navigate business rates in the current climate.

The Double Hit: Credit Crunch and Business Rates

The recent tightening in credit markets, driven by rising interest rates and cautious lending practices, is making it more difficult for consumers to finance vehicle purchases. With car loans now more expensive, dealerships are seeing reduced demand, affecting both new and used car sales. For many car dealers, this drop in turnover is hitting at the same time as high fixed costs associated with business rates, creating a "double hit" that threatens profitability.

Business rates are one of the largest fixed costs for car dealerships. Calculated based on the rateable value of the premises rather than turnover, these rates do not adjust with market conditions. For dealerships experiencing a downturn in sales, this creates an unsustainable burden.

Key Challenges for Car Dealerships

• • Reduced Consumer Demand and Revenue Decline
  With consumer financing less accessible, demand for vehicles is expected to slow. Car dealerships that previously relied on consistent sales for cash flow may struggle to manage fixed costs like business rates. Since these rates remain unchanged despite revenue fluctuations, dealerships face financial pressure that could lead to budgetary constraints in other critical areas.


• • Inflexible Operational Costs
  The essential nature of dealership operations means that reducing premises or forecourt space to save costs is rarely an option. Consequently, dealerships must absorb business rates costs with little flexibility to adapt, which can be particularly challenging during downturns. This lack of flexibility further underlines the importance of proactive cost management.


• • Cash Flow Management in a Tightened Market
  Cash flow is crucial for dealership operations, and high business rates can be an ongoing drain on liquidity. For smaller dealerships in particular, maintaining positive cash flow while facing reduced sales and high rates is challenging.

Strategies for Managing Business Rates

Amidst these challenges, car dealerships have several strategic options to help manage business rates effectively:

• • Explore Reliefs and Appeals
  Dealerships should investigate all available business rates relief options, even if they may not traditionally qualify for standard retail reliefs. Consulting with a business rates expert can help uncover potential reliefs or avenues for appeal based on hardship or operational changes.


• • Keep Abreast of Property Revaluations
  The economic impact on the car market may eventually influence property values. Dealerships should monitor any revaluations or market changes that could enable them to appeal their rateable value. Staying aware of valuation updates can open avenues for rate reductions.


• • Engage in Strategic Financial Planning
  Given the combined impact of high rates and lower sales, dealerships should consider restructuring financial strategies to mitigate costs. Engaging with business rates consultants can aid in identifying optimal savings approaches and help dealerships budget more effectively.


• • Advocate for Sector-Specific Relief
  With the automotive industry facing unique challenges, industry groups may advocate for temporary relief or legislative changes that benefit dealerships. Engaging with industry bodies to support this advocacy could help dealerships collectively influence business rates policy.

Looking Ahead: A Strategic Approach

The current landscape calls for proactive measures from car dealerships. While business rates are a substantial burden, effective management and expert guidance can help dealerships navigate these costs, potentially unlocking savings through reliefs, appeals, and strategic planning.

At Kevin Lavender Consultancy, we’re here to support dealerships in assessing their rateable values, exploring relief options, and managing rates more effectively. With our expertise in business rates and a no-win, no-fee approach, we aim to secure optimal outcomes for our clients in an ever-evolving market.

Contact Us today to discuss how we can help your dealership reduce business rates and strengthen financial resilience in challenging times.

Why Businesses Must Be Proactive in Securing Business Rates Reliefs

For many businesses, business rates relief can be the difference between manageable expenses and overwhelming financial strain. Yet, experience shows that many businesses miss out on potential savings due to delayed or incomplete administration on the part of local councils. While councils manage complex caseloads and competing priorities, this reality often leaves businesses waiting longer than expected for reliefs or refunds they may be eligible for.

To avoid missed opportunities, it’s vital for business owners to take a proactive stance in securing these reliefs. Here, we’ll discuss why this approach is essential and how businesses can maximise their chances of obtaining the relief they’re entitled to.

Understanding the Reality of Business Rates Administration

While local councils are responsible for managing business rates, the process of administering reliefs can often be slower than businesses would hope. A report by the Local Government Association (LGA) indicates that many councils face high administrative burdens, which can delay the timely processing of relief applications. In addition, complex eligibility criteria and periodic updates to relief schemes can add further complications, sometimes resulting in significant delays or inconsistencies in application outcomes.

This isn’t necessarily the fault of any individual council – the systems and resources in place are often stretched thin. Nonetheless, these realities make it crucial for businesses to remain engaged and proactive throughout the relief process to avoid falling through the cracks.

The Importance of Regular Follow-Ups

One of the most effective ways to ensure relief applications are processed efficiently is through regular follow-up. A proactive approach doesn’t just keep an application top-of-mind for council administrators; it can also help address potential issues before they escalate into costly delays.

For instance, data published by the Federation of Small Businesses (FSB) highlights that many smaller businesses experience longer-than-expected wait times due to administrative backlogs. Following up frequently allows businesses to stay informed about the status of their application and resolve any outstanding questions or documentation needs.

Document Everything

Another critical aspect of being proactive is maintaining thorough documentation. This includes keeping copies of all submitted applications, correspondence with council staff, and proof of eligibility for specific reliefs. In cases where an application appears to stall, comprehensive records can support a more effective follow-up, providing clear evidence of eligibility and timely submission.

The Valuation Office Agency (VOA) has also emphasised the importance of keeping detailed records when applying for reliefs, as accurate documentation can prevent common processing issues.

Don’t Rely Solely on Council Notifications

While councils typically notify businesses of relief eligibility, relying solely on these notifications can lead to missed opportunities. Some reliefs, such as Small Business Rate Relief and Retail Discount, may be available to businesses that don’t automatically receive notifications due to registration details or other administrative oversights. Businesses should regularly review available reliefs to ensure they’re not missing out on opportunities that could substantially reduce their costs.

Recent case studies shared by the British Chambers of Commerce reveal that businesses actively reviewing their eligibility and making proactive applications often secure reliefs faster than those waiting for council communication.

Engage Professional Support for a Seamless Process

Given the administrative complexities involved in business rates relief, partnering with a business rates consultant can be highly advantageous. A knowledgeable consultant can help identify all eligible reliefs, complete and submit accurate applications, and follow up diligently to expedite processing.

Our team at Kevin Lavender Consultancy specialises in navigating these processes, leveraging years of experience in dealing with local councils to secure reliefs for our clients. We handle the details so you can focus on running your business, with a no-win, no-fee approach that ensures you only pay if we’re successful in obtaining savings on your behalf.

Act Now to Maximise Savings

In an environment where relief administration can be slow and complex, the responsibility often falls on businesses to advocate for their own interests. Being proactive, documenting thoroughly, and seeking professional support when needed are key steps in ensuring you receive the full benefit of available reliefs.

For more information on how Kevin Lavender Consultancy can help you secure business rates reliefs, Contact Us today. Our no-risk, no-win, no-fee service is designed to deliver results and put savings back into your business where they belong.

Maximising Section 47 Discretionary Relief: Why Proactive Applications Matter

Business rates reliefs are critical lifelines for many businesses, particularly those operating in sectors like retail, hospitality, and leisure. One significant type of relief offered by local councils is Section 47 discretionary relief, which enables businesses to seek reductions on their rates bills. However, securing and backdating this relief can be challenging—especially when relying solely on standard council processes.

What is Section 47 Discretionary Relief?

Under Section 47 of the Local Government Finance Act 1988, councils have the discretion to award relief on business rates, primarily aimed at supporting businesses that contribute to the local economy or face financial hardship. This relief can offer valuable financial assistance, especially in a tough economic climate. Eligible businesses may find that this discretionary relief alleviates the burden of business rates, freeing up cash flow for growth or essential operational needs.

The Deadline for Backdating Applications: 30 September

One key aspect of Section 47 discretionary relief is the ability to backdate the relief to cover previous financial years. However, businesses must apply by 30 September of the following financial year to qualify for backdated relief. For example, if a business wishes to secure relief for the financial year ending 31 March 2024, the application must be submitted by 30 September 2024. Missing this deadline often means that councils will not backdate the relief, even if the business would otherwise be eligible.

The Challenges of Going It Alone

Many businesses find the application process for Section 47 relief to be complex and time-consuming, with strict documentation requirements and sometimes limited communication from councils. Furthermore, councils, due to stretched resources, may have errors or delays in their administration of relief. Without experience navigating these processes, businesses often miss opportunities for backdating relief or face rejections due to incomplete applications. Missing this September deadline can mean the difference between significant savings and an increased financial burden.

How a Business Rates Consultancy Can Help

Working with a business rates consultancy can simplify and strengthen the Section 47 application process. Business rates experts are skilled in identifying common administrative oversights made by councils, ensuring applications are not only complete but also positioned to highlight any errors that justify backdating. Here’s how a consultancy can add value:

• • In-depth Analysis: A consultancy will thoroughly review your business rates account, identifying potential errors or missed relief opportunities. They know what to look for in council records, which can be essential for successful backdating claims.


• • Proactive Advocacy: Business rates consultancies understand the nuances of council procedures and deadlines. They proactively manage timelines and can advocate on your behalf, ensuring councils act on backdating requests before the September cut-off.


• • Documentation Precision: Experienced consultants ensure applications are complete and accurate, meeting all council requirements. Proper documentation can be pivotal in gaining backdated relief.


• • Follow-Up and Appeals: If a council initially denies a backdating application, a consultancy is well-positioned to appeal or present further evidence to support your case, maximising the likelihood of relief approval.

Don’t Miss Out: Act Now for Backdated Savings

The September deadline for backdated Section 47 applications underscores the importance of acting quickly and proactively. Without the support of business rates professionals, many businesses struggle to navigate the intricacies of council processes and often miss out on potential savings. By partnering with a business rates consultancy, businesses can increase their chances of securing valuable relief, ensuring they are not overpaying on their business rates.

If you’re unsure whether your business qualifies for Section 47 discretionary relief or need assistance with an application, consider consulting a business rates expert. With professional guidance, your business can maximise relief opportunities, secure potential backdating, and alleviate the financial impact of business rates.

Understanding the Business Rates Appeal Process

Navigating the complexities of business rates can be challenging for many business owners. The Valuation Office Agency (VOA) assigns a rateable value to commercial properties, which directly influences the business rates payable. If you believe your property's rateable value is incorrect, initiating an appeal through the Check, Challenge, Appeal (CCA) process is a viable option.

1. Check

Begin by reviewing the details the VOA holds about your property. This includes verifying the accuracy of property information and ensuring that the rateable value reflects the current market conditions. If discrepancies are found, you can request corrections during this stage.

2. Challenge

If issues remain unresolved after the Check stage, you can proceed to Challenge. This involves submitting a formal challenge to the VOA, providing evidence to support your claim that the rateable value is incorrect. The VOA will review the evidence and respond accordingly.

3. Appeal

Should the Challenge stage not yield a satisfactory outcome, the final step is to Appeal. This entails taking your case to the Valuation Tribunal for independent review. It's crucial to present a well-prepared case, as the tribunal's decision is binding.

Key Considerations

• •Timeframes: Each stage has specific deadlines. For instance, you typically have four months to submit a Challenge after completing the Check stage.


• •Evidence: Gather comprehensive evidence, such as rental information, property details, and market data, to substantiate your claim.


• •Professional Assistance: Engaging with professionals experienced in the CCA process can enhance the likelihood of a successful appeal.

Conclusion

While the CCA process offers a structured approach to contesting your business rates, it requires diligence and a thorough understanding of each stage. By proactively managing your business rates and seeking expert guidance when necessary, you can ensure that your property is assessed fairly, potentially leading to significant savings.

Changes to Empty Property Rate Relief: What You Need to Know

As part of the Spring Budget 2024, significant reforms have been announced regarding the business rates system, particularly focused on tackling avoidance and evasion. Among the notable changes are amendments to the rules governing empty property rate relief. These adjustments, set to come into effect from 1 April 2024, will impact businesses and property owners across England. Here’s a comprehensive breakdown of what you need to know about these changes and what they mean for ratepayers.

The Key Changes to Empty Property Rate Relief

Under the existing rules, owners of empty commercial properties can benefit from rate relief after a short period of occupation. This relief is currently reset after the property is reoccupied for a minimum of 6 weeks. However, from 1 April 2024, this reset period will extend to 13 weeks. This means that:

• •If a previously empty property is reoccupied before 1 April 2024, the current 6-week rule will still apply.
• •For properties reoccupied on or after 1 April 2024, they must be continuously occupied for 13 weeks before they qualify for another period of empty property rate relief.

This change aims to close loopholes that some property owners exploit by briefly occupying properties to reset the relief period multiple times, thereby avoiding paying business rates.

Why the Changes Were Introduced

The government’s decision to extend the reset period is part of broader reforms to address business rates avoidance and evasion. During consultations, it became evident that the existing rules were being misused, undermining the fairness of the system. By extending the reset period to 13 weeks, the government seeks to:

• •Reduce abuse of the relief system.
• •Ensure that businesses and property owners contribute fairly to local services.
• •Level the playing field for those adhering to the rules.

Other Measures to Combat Avoidance and Evasion

Alongside changes to the reset period, the government has outlined several additional steps to strengthen the integrity of the business rates system:

• 1General Anti-Avoidance Rule (GAAR): The government plans to consult on introducing a GAAR for business rates in England. This would allow greater flexibility in tackling new avoidance schemes as they arise, ensuring that the system remains robust against evolving tactics.



• 2Increased Awareness of Reliefs: To address concerns about rogue business rates agents preying on small business owners, the government will enhance communication strategies to:


• •Raise awareness of available reliefs.
• •Educate ratepayers on how to engage reputable agents and avoid scams.


• 3Improved Demand Notice Regulations: Potential changes may be introduced to clarify how ratepayers can instruct agents and access support.

Implications for Ratepayers

The changes to the empty property rate relief reset period will likely have significant implications for property owners and businesses. Some key considerations include:

• •Longer Occupation Periods: Businesses must now plan for longer continuous occupation periods (13 weeks) to reset the relief.
• •Increased Costs for Vacant Properties: The extended reset period could lead to higher costs for property owners struggling to find long-term tenants.
• •Proactive Management: Ratepayers will need to be more diligent in managing their properties and seeking professional advice to navigate these changes effectively.

How We Can Help

At Kevin Lavender Consultancy, we specialize in helping businesses and property owners navigate the complexities of business rates. Our no-win, no-fee approach ensures that there’s no financial risk to you as we work to identify potential savings or reliefs you may be eligible for.

If these changes to empty property relief raise concerns for your business, contact us today. Our expert team can review your property’s business rates and provide tailored advice to help you minimize costs and maximize relief opportunities.

Looking Ahead: The Future of Business Rates

With further consultations on a General Anti-Avoidance Rule (GAAR) and changes to agent regulations, the business rates landscape is set to evolve. Staying informed and proactive will be crucial for all ratepayers. At Kevin Lavender Consultancy, we’re committed to keeping our clients ahead of the curve, ensuring they benefit from fair and accurate assessments.

For more information or to schedule a free consultation, contact us today. Let us help you take control of your business rates.