Rates Relief on Obsolete Building

It has taken two appeals and 5 years of negotiations by Underwoods. Eventually the Valuation Office Agency conceded that a disused flour mill in Peterborough was obsolete and the Rateable Value has been reduced to zero with effect from June 2010 yielding a rates refund in excess of £150,000.

Rating Law dictates that buildings are assumed to be in a reasonably good state of repair. The Valuation Office have argued successfully that this even applies where a property is undergoing a major refurbishment and has been stripped to a shell. These were the circumstances involving an office suite in Sunderland in the case of SJ and J Monk v Newbigin (2015). The Upper Tribunal (Lands Chamber) had decided that the Rateable Value should be reduced to £1 during the course of the works, but the Court of Appeal overturned this decision stating that before any consideration is given to considering the level of Rateable Value, the building should be assumed to be in a reasonably good state of repair and ready for occupation. This is seen by many practitioners as a strange decision because it moves the Rating Assessment away from reality and a Rateable Value as being assessed effectively for something which does not exist.

However, the Upper Tribunal decision in Barber (VO) v CEREP III TW SARL (2015) has given ratepayers per something to celebrate. It concerned an empty retail unit in Tunbridge Wells Kent which formed part of a site which was being assembled for redevelopment. The units immediately adjoining the unit had been surrounded by hoarding for several years and although the property itself was not included within the area inside the hoardings it had been boarded up. It was in disrepair and had been vandalised leaving asbestos exposed. The Valuation Office suggested that the property had a Rateable Value of £57,500 on the basis that it could be put back into a reasonably good state of repair and should be assumed to be in such a state.

The Upper Tribunal found in favour of the Appellant and reduced the Rateable Value to £0. Meanwhile, the Newbigin case is the subject of an appeal to the Supreme Court which is being sponsored by the professional body of rating surveyors – The Rating Surveyors Association.

 

For further information please contact:

Andrew Boulter 01604 783001 email ab@underwoods.co.uk

Robert Keeves

01604 774143

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Rates Relief on Obsolete Building

It has taken two appeals and 5 years of negotiations by Underwoods. Eventually the Valuation Office Agency conceded that a disused flour mill in Peterborough was obsolete and the Rateable Value has been reduced to zero with effect from June 2010 yielding a rates refund in excess of £150,000. Rating Law dictates that buildings are […]