According to rating experts at Colliers, business rates reforms stand to further complicate a system which has left businesses “vulnerable” to illegitimate rating surveyors following the closure of the 2017 Rating List on 31 March.
The international property consultants believe new “duty to notify” and annual returns requirements, expected to come in later this year, will place a “significant administrative burden” on rate payers.
The measures will require businesses to provide updates on rents and lease information alongside trading information, and are likely to increase dependence on external advisory companies.
Colliers head of business rates John Webber said: “Currently out of approximately 1.9m ratepayers, 700,000 pay no business rates due to reliefs. These changes will result in these 700,000 ratepayers being required to send one or more pieces of information annually to the VOA, involving them in a bureaucratic exercise that plays into the hands of rogue “advisers” who will claim to advise them”.
The 2023 revaluation has reportedly created a two-tier system between owners who were “more successful in negotiating lower and more correct values” – and those who were not.
Where this disparity may have seen smaller businesses not afforded the reduction due to their rates on 1 April, they are increasingly likely to be approached by “unscrupulous advisors”.
Among the trends Colliers has noted as contributing to the risk of businesses being “burnt” by the ‘rating experts’ is the emergence of rating companies whose members are without rating qualifications.
They have also reported finding rogue surveyors to be “spamming companies to act with a sense of urgency” following the closure of the 2017 list, while “promising to find them savings ‘for a fee’”. Colliers report these savings are often unavailable, and the fee non-refundable.
“The problem is the industry is totally unregulated”, added Webber. “Anyone can set up and claim they are experts. That is why we have been calling for RICS or, failing that, government regulation and for there to be a register of rating advisors, to make sure the cowboy and criminal element that prey on businesses are kept at bay.”