Industrial DeratingThe decision to phase out industrial derating was announced in April 2003 following a public consultation exercise on the Review of Rating Policy in May 2002. For more information, including details of the consultation process, policy paper and legislation, go to www.ratingreviewni.gov.uk. The phased removal of industrial derating began in April 2005. Originally the phasing out was planned on the basis of a gradual increase in liability until industrial properties attracted full rates in 2011. However, following a further review of rating policy initiated by the Assembly, it was decided to cap liability at the current level of 30% until the end of the current budget period in 2011. How does the phasing out affect me? If your property was occupied and used for industrial purposes on 1 April 2005, you became liable for rates at 15% of your full rate liability at this date. The percentage amount of your full rate liability payable from 1 April 2006 will be:
What is my full rate liability based on? Your full rate liability is based on an assessment by Land and Property Services of the rental value of your property. This includes any buildings, yards and rateable plant and machinery. The assessment is normally referred to as your property’s Net Annual Value (NAV). Please note that we are carrying out a rating revaluation of all non-domestic properties. The revaluation will use rental values as at 1 April 2008. Derating will not be affected by the revaluation. For more information see the revaluation of non-domestic properties page. What is rateable plant and machinery? Rateable plant and machinery is normally confined to power generation and distribution equipment and specified structures and containers. This would have the greatest impact on heavy engineering businesses. As a general rule if any plant and machinery is assessed, the amount attributable to these items is usually a small fraction of the total NAV. How can I find out the current NAV of my property? You can –
Can I appeal my valuation? Yes. You can ask the District Valuer to carry out a review. You also have further rights of appeal to the Commissioner of Valuation and the Lands Tribunal for Northern Ireland. How is my rate bill worked out? Your rate bill is calculated by multiplying the NAV of your property by the non-domestic rate poundage for the relevant year and then applying the percentage for that year as shown above. What if my property is vacant? The phasing out arrangements apply only when your property is occupied. If your property is vacant, it is assessed for rates under the unoccupied rating legislation, which came into operation on 1 April 2004. Are there any exemptions? Certain vacant industrial properties, such as vacant mines and quarries, are exempt from this new rate. Factories may also be entitled to exemption, however, this entitlement is assessed on a case-by-case basis. There is also an initial three-month exemption period for those not entitled to a full exemption. Should I seek independent advice about the NAV? During any discussion with us about your property’s NAV, you do not need to have independent representation. However, if you (or your company wish) to be represented or to seek independent advice, members of the Royal Institution of Chartered Surveyors (RICS) and the Institute of Revenues, Rating and Valuation (IRRV) are qualified and regulated by rules of professional conduct. Before employing a rating advisor, you should check that they have –
Be careful about paying consultants up front either for their services or for them to lodge appeals on your behalf. If you are unsure, seek further guidance from the RICS or IRRV before entering in to any contract. |
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