What is the Rateable Value of My Property?

Rateable value is an estimated annual rental value of a property at a specified date of reference, presuming the property was unoccupied at the time and to let out from year to year.

The arrangement is usually done on the basis that the renter agrees to pay all normal rental rates and taxes, while the landlord agrees to pay the Government rent, repair costs, insurance and other essential expenses for maintaining the property till it is worth the listed rent.

What factors are taken into account when assessing rateable value?

When assessing rateable value, the other open markets or the valuation dates for identical properties are a point of reference. Adjustments such as differences in size, location type, facilities, finishing quality and management are also take into account. However, sales or letting restrictions like the ones that apply to the ratepayer’s financial status and Ownership Scheme flats will be disregarded.

Are there different assessments for the rateable value of different properties?

No. The rateable value of all property types, including public and private housing are performed on the same basis. This allows an unbiased and uniform foundation for charging rates in line with the rental properties of the open markets.

Why do we designate a valuation reference date for rating purposes?

The reason for this is to evaluate the rateable value with reference to the value at a specified date, otherwise regarded as the “relevant date”. Common value changes after the relevant date are not significant, so any observed decease or increase in value since that date will have no effect of rateable value.

The relevant date has always been October 1 for the Valuation List to become applicable on April 1 the next year. For the 2017/18 rateable value, the specified reference date was October 1st, 2016.

What factors are used to calculate rateable values?

The following factors are taken into account;

  • Age
  • Size
  • Finishing quality
  • Geographical location
  • Transport facilities
  • Other amenities

Who sets the rateable value and business rate?

The Valuation Office Agency (VOA) sets the rateable value for non-domestic (properties or land that aren’t being use only for residential purposes). A property may house a number of non-domestic occupants and owners, so rateable values are assigned to each piece of separately-occupied property.

Local councils are given a list of rateable values; they are then used to calculate non-domestic rates (or business rates). Non-domestic properties with a domestic part (such as a salon with the owner’s flat above) are tagged as composite properties. Such buildings are valued for both Council Tax and business rates.

Can I use an online service to check my rateable value?

Yes, there is an online platform for this. If you are the owner, resident or approved agent of a property, you can sign in or register to use it.

The following services are available:

  • Assign an agent (if you are the owner or resident)
  • View or ask to see the complete details of your valuation
  • Suggest changes to the details of your property (extensions, splits and fusions, change of use)
  • Inform the VOA about certain external factors affecting your property (Interfering road-side constructions, flooding and so on)
  • Appeal for a rateable value change (after verifying the details)

How frequently do I have to pay rates?

Rates are to be paid every quarter and in advance. Homeowners usually receive the demands at the start of each quarter, and are payable before the first month of the quarter is over. That is January, April, July and October.

My property is liable to sale and renting restrictions. Am I entitled to any concessions because of these restrictions and my special financial condition?

Unfortunately, there are no concessions for these circumstances. The rateable values for all property types, as well as public and private housing, are evaluated under the same conditions, regardless of any special concessions, be it legislative or not, in the rent being charged.

Likewise, any restriction on sale or renting to which you consented to upon purchase of the property will not impact the level of assessment either. Your special financial conditions which may affect your ability to pay rates won’t be a determining factor when setting your rateable value.

My building is in an area poor facilities. Why is my overall percentage charge the same as areas with better facilities?

Rates form a part of the whole Government revenue and are a major source of capital for public services such as the fire service, the police, hygiene, healthcare and education which everybody accesses one way or the other.

If the local services are below par, it will be evident in your monthly rent, hence the rateable value. Nevertheless, in the rare occasion that there is no Governmental water supply, there will be a reduction of 15% in the rate payable. And if there is Governmental water supply, but it isn’t filtered the rates payable will be reduced by 7.5%.

Why do rent occupiers have to pay the same rates as owner-occupied properties?

Rates are set up on a tax on occupation basis and is usually paid by the occupier. So, whether you are a renter-occupier or owner-occupier, you are being charged rates under the same conditions.

Why are rateable values for domestic units on lower floors cheaper than those of higher floor?

This is because there is a market preference for flats on higher floors than those on lower floors. Rental rates for storied buildings tend to increase with floor levels. Conversely, flats on the lower floors suffer noise, intrusions and so on. Thus, this has been taken into consideration.

Why is there a rate revaluation?

Rateable values are subject to a general revaluation every year. The purpose of this is to account for the continuous changes in the market value of a property. Rental levels for various property types and those in various locations tend to change with time due to factors such as, market forces, economic and social influences, demography and so on.

A revaluation factors these changes into the calculation and redistributes the rates according to their unique conditions. This way, all types of properties are covered. However, it is important to note that while some rates are decreased, others may be increased.

If you would like to know more about rateable values, please give us a call: 0800 020 9561

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Published on 1st June 2017

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