Rating legislation in the UK currently provides for all non-domestic property to be regularly revalued, normally every five years. The last revaluation in England, Scotland and Wales was effective from 1 April 2005, and in Northern Ireland from 1 April 2003. All four were scheduled to have their next revaluation effective from 1 April 2010, but at the end of September, Northern Ireland’s was postponed until 2011.

We recognise this might be of interest to partners and non-partners alike, but can be a difficult topic to get your head around; therefore Drivers Jonas LLP - property consultants - have put together some handy questions and answers to give you all the rating revaluation details you might need.

What is a revaluation?
A revaluation is similar to a rent review on your property, but instead of your property being reviewed in isolation, all non-domestic properties are reviewed on the same day. In England, the exercise amounts to revaluing more than 1.7m properties.

Why have a revaluation?
Over a period of time, rental values for different categories of property move at a different pace, and even in different directions. These rental movements are assumed to normally reflect the economic state of the business that occupies that particular category of property, and therefore its ability to pay.

Antecedent valuation date (AVD)
This is the date that all assessments for the relevant list will reference to for rental levels. For all revaluations since 1990, it has always been set two years before the list comes into force, and for the 2010 revaluation it is no different.

2010 revaluation – change in rateable value
The 2010 Rating List Rateable Values will be effective from 1 April 2010. These assessments are based on net rental values as at 1 April 2008. For many categories of property, 1 April 2008 was either at the recent height of the property market or certainly very close to it. This has been reflected in the draft 2010 revaluation assessments for England and Wales, which were published on 1 October 2009. In England, the statistics issued by the government show that there has been a widely differing movement of rateable values (RV), dependent on the property sector and geographic location, with London showing the highest movement, at 27.9% for all properties.

2010 revaluation – change in rates payable
The government has announced that the provisional multiplier for 2010/11 in England will fall to 40.7p for small hereditaments – which are those with rateable values under £25,500 in Greater London and £18,000 elsewhere. In England there will be transitional arrangements to phase in large increases in rate liability. The scheme will be self-financing. The final details of the arrangements have not been published, but the government’s preferred scheme can be seen HERE
Note: These are year-on-year caps on increases. For instance, the maximum increase for small properties over five years would be 64%. But a small property with an increase of 7% would reach its full bill in year 2.

For properties with rateable values at or in excess of the small hereditament threshold, there will be an addition of a small business rate supplement. The government has announced that the level of this supplement will rise from 0.4p to 0.7p. All properties within the City of London currently pay a 0.4p supplementary rate. Details of this rate for 2010/11 will not be known until February 2010, when the City Corporation sets it. Neither of these supplements will be subject to transition.

Business rate supplement
New legislation has been introduced to enable top-tier local authorities to levy a business rate supplement to help fund major infrastructure projects. To date, only one has been announced. This is a business rate supplement of 2p on all properties with rateable values greater than £50,000 within Greater London. This levy will not be affected by any transitional arrangements, and it is likely to be in place for at least 24 years; the proceeds will be used to fund Crossrail.

Right of appeal
There is a right of appeal against the rateable value of your property. The main areas likely to be covered by any appeal include:

• incorrect factual information;
• unit of assessment incorrect;
• level of value to high; and
• material change of circumstances.

The earliest date for lodging an appeal against the 2010 list assessment is 1 April 2010. However, because transition will be based on current rate liability, it is important to ensure that a final check is made on your 2005 assessment. Before the 2010 list comes into force, there is also an opportunity to have any factual errors corrected.

If you have any questions or would like to discuss any of these issues, please contact Robert Murdoch, Partner, Head of Rating, Drivers Jonas LLP on (0)20 7896 813 or email robertmurdoch@driversjonas.com