Wales
Wales
CHECK, CHALLENGE APPEAL PROCESS
Regulations have been passed in the Senedd which enable Wales to move to the Check, Challenge and Appeal process and this bring the appeals process in line with England. From 01 April 2023 ratepayers in Wales who wish to appeal their 2023 Rateable Value or report a change with the assessment will be required to follow the Check Challenge Appeal process and will use the Valuation Office Agency’s Check and Challenge digital service. This will follow the same process that has been in practice in England since 2017. This service will allow a ratepayer to –
- Check the rateable value (RV) of their property
- Tell the VOA if their property details need changing or removing from the list.
- Tell the VOA if they think their rateable value is too high
- Appoint an agent to deal with their business rates on their behalf
Any outstanding proposals or appeals on the 2017 rating list will be processed through the previous system of appeals.
MULTIPLIERS
*Estimated increased based on projected CPI in the prevailing September (OBR prediction 1.6%).
Uniform Business Rate
In Wales there is no separate UBR supplement for large properties.
Transitional Relief
The Welsh Government are providing a targeted Transitional Relief Scheme in relation to the 2023 Revaluation. This Relief will be applicable to any Ratepayer whose liability is increasing by more than £300 as a consequence of the revaluation. Any increase over £300 in Rates Payable will be phased in over the 2023/24 and 2024/25 Rates years. A ratepayer will pay 33% of their additional liability in the first year (2023-24) and 66% in the second year (2024-25), before reaching their full liability in the third year (2025-26). To be eligible for the transitional scheme the relevant hereditament must –
- have been shown on a local list or central list on 31 March 2023 (the day before the new lists compiled on 1 April 2023 have effect).
- have an increase in liability of more than £300 (the de minimis threshold below which the administrative costs of providing this relief are deemed to outweigh the benefits).
- not be in receipt of relief for partially occupied properties (under section 44A of the Local Government Finance Act 1988 (the 1988 Act);
- not be a case to which zero rating of unoccupied properties applies (under section 45A of the 1988 Act); and
- be occupied by the same occupier of the property as on 31 March 2023. If not, the relief ceases to apply. If the property is unoccupied on 31 March 2023, this condition is not met.
In the Welsh Transitional Scheme, Transitional Relief is not the primary relief and is relevant to the Ratepayer rather than the hereditament. This means that it is applied after any entitlement to Small Business Rates Relief is considered and should the Ratepayer change entitlement to transitional relief ceases, this means that the transitional relief in Wales is calculated on a daily basis unlike in England and Scotland where the relief is calculated on an annual % basis.
RETAIL, LEISURE AND HOSPITALITY RELIEF – COVID-19
Retail, Leisure and Hospitality Relief – (1st April 2020 – 31st March 2021). With effect from 1st April 2020, for a period of 12 months, 100% relief will be applied to all Occupied Retail, Leisure and Hospitality Businesses with an RV up to and including 500,000. With effect from 1st April for the period 1st April 2021- 31st March 2022 the above relief has been extended for the period of a further 12 months, for Hospitality and Leisure. The RV cap of 500,000 will be removed and the 100% relief will be available for properties that fall within those sectors and meet the qualifying criteria whose RV is over 500,000. Hereditaments which have closed temporarily due to the government’s advice on Covid-19 are to be treated as occupied for the purposes of this relief. For the 2020/21 & 2021/ 22 Rate Year the Government’s assessment is that, given the impact of Covid-19, the ‘Relief’ outlined above is not subject to either of these restrictions on subsidy funding under State Aid/Subsidy Allowances under Article 3.2(4) EU-UK Trade and Cooperation Agreement by Subsidy Control. From 1st April 2022 Ratepayers who occupy Retail, Leisure and Hospitality properties will receive 50% relief for the period 1st April 2022 – 31st March 2023. The relief will be capped at £110,000 per business+ across Wales. From 1st April 2023 Ratepayers who occupy eligible Retail, Leisure and Hospitality properties will receive 75% relief for the period 1st April 2022 – 31st March 2023. The relief will be capped at £110,000 per business+ across Wales. This brings the relief in line with the current scheme offered in England.
With effect from 1st April 2024 the applicable relief will reduce from 75% to 40% for the period 1st April 2024 – 31st March 2025. The relief will be capped at £110,000 per business+ across Wales.
State Aid/Subsidy Allowances under Article 3.2(4) EU-UK Trade and Cooperation Agreement by Subsidy Control- The Government’s assessment is that, given the impact of Covid-19, the ‘Relief’ outlined above is not subject to either of these restrictions on subsidy funding.
SMALL BUSINESS RATES RELIEF
A permanent scheme came into force on 1 April 2018 and this has been extended into the 2023 Revaluation. The Welsh Government provides Non-Domestic rates relief to eligible small businesses.
- Eligible business premises with a RV of up to 6,000 will receive 100% relief; and
- Those with a RV between 6,001 and 12,000 will receive relief on a tapered basis from100% to zero
Certain business categories benefit from an additional level of relief. For example, post offices and registered childcare premises.
The number of properties eligible for Small Business Rates Relief is limited to two properties per business in each local authority. The following types of businesses will continue to get relief as follows:
Registered Childcare Premises
Eligible registered childcare premises with a RV of up to 6,000 receive 100% relief; and Those with a RV between 6,001 and 20,500 receive relief on a tapered basis from 100% to zero.
From the 1st April 2019, The Small Business Rates Scheme for “Childcare Providers” will be extended to provide 100% relief to all “Registered Childcare Providers” in Wales. This higher level of relief will be effective until 31st March 2025 - during this the Welsh Assembly will be evaluating the effectiveness of the relief.
Post Offices
- Post offices with a RV up to 9,000 receive 100% relief
- Post offices with a RV between 9,001 and 12,000 receive 50% relief
Multiple occupation limit
Where a ratepayer is liable for more than two properties on a single local Non-Domestic rating list (‘local list’), and those properties meet only the RV conditions, the ratepayer will only receive relief for a maximum of two such properties.
ENTERPRISE ZONES BUSINESS RATES SCHEME+
The Enterprise Zones Business Rates Scheme was introduced as a means of providing small and medium sized enterprises (SMEs) in Enterprise Zones with support in paying their Business Rates bills. The scheme targets SMEs demonstrating business growth characteristics, that is, new starts or those increasing the size of their full-time workforce. It forms part of the wider set of actions aimed at delivering growth and sustainable jobs in each Enterprise Zone. The scheme is only available within specific time frames.
HYDROPOWER PROJECTS+
Grants are available to help eligible hydropower projects with their Business Rates. Hydropower projects extract energy from water courses to generate electricity. Hydropower projects with an RV of up to 50,000 can apply for support for from 2017 -2023 (this relief can be applied retrospectively).
EMPTY PROPERTY: RELIEF AND EXEMPTIONS
Since 1st April 2011, the threshold at which empty properties become liable to pay rates dropped from 18,000 to 2,600. The remaining reliefs are the same as those in England and are set out below:
* Exemption applies when property is newly assessed for rates or when it is vacated provided a period of “rateable occupation” exceeding 42 days has occurred. ** Exemption applies where Local Authority are of the view that the property will next be occupied by a Charity.
CHARITABLE RATE RELIEF+
If your property is occupied by a registered charity or community amateur sports club, and used for charitable purposes, you automatically qualify for 80% mandatory rates relief. You may qualify for relief of up to 100% at the discretion of the Billing Authority if your property is occupied by a non-profit making body.
HARDSHIP RELIEF+
Billing Authorities can also grant hardship relief to businesses if they believe that it is in the interests of the local community to do so.
PUBLIC TOILET RELIEF
The Non-Domestic Rating (Public Toilets) Act received Royal Assent on 29 April. This Act provides a 100% business rates relief for separately assessed public toilets in England and Wales, including those being operated by local authorities. This relief applies retrospectively from 1 April 2020.
SELF-CATERING PROPERTIES, SECOND HOMES AND LONG-TERM EMPTY DWELLINGS
In Wales, if your property is commercially available for short term self- catering lets, provided certain criteria are met, it will be rated and valued for Business Rates rather than be valued and banded for Council tax. From 1st April 2010 in Wales, self-catering property is ‘Non-Domestic’ and therefore liable for ‘Non-Domestic Rates’, if: The property will be available for letting commercially as self-catering accommodation for short periods totalling 140 days or more in the following 12-month period. The ratepayer’s interest in the property enables them to let it for such periods. In the 12 months prior to assessment, it has been available for letting commercially as self-catering accommodation for short periods totalling 140 days or more. The short periods it has been commercially let for amounted to at least 70 days during that period. From 1st April 2016 in Wales, the criteria above will continue to apply but there is also a new provision so that Businesses consisting of several self-catering properties at the same location or within very close proximity, have the option to average the number of letting days of the properties to meet the 70-day criterion where they are let by the same or connected businesses.
Further to the above the Welsh Government have announced with effect from 1st April 2023 the following changes to the way in which they treat second homes, long-term empty dwellings, and self-catering accommodation. From April 2023, the maximum level at which local authorities can set Council Tax Premiums on second homes and long-term empty properties will be increased to 300%. This will enable Councils to decide the level which is appropriate for their individual local circumstances. Councils will be able to set the premium at any level up to the maximum, and they will be able to apply different premiums to second homes and long-term empty dwellings. From April 2023 the criteria for self-catering accommodation being liable for Business Rates rather than Council Tax will change. The threshold to be considered commercial will change from being available to let for 140 days and achieving 70 days letting in any 12-month period, to being available for let for 252 days and achieving 182 days letting, in any 12-month period. +Relief is subject to Subsidy Allowances under Article 3.2(4) EU-UK Trade and Cooperation Agreement by Subsidy Control, this allowance is 325,000 Special Drawing Rights, to a single economic actor over any period of three fiscal years, which is the equivalent of £335,000. The Subsidy Control Act 2022 will provide framework for the new UK wide Subsidy Control Regime.