Tuesday 19 September 2017

Take the steps to minimise commercial rate liabilities

With the revaluation of all commercial and industrial properties in the Dublin City Council area currently underway businesses and landlords should plan carefully as to how to minimise their commercial rates liability for at least the next ten years.

A lower rates liability not only reduces the current outgoings for the property but it also makes the building more attractive for potential buyers/occupiers.

Below is a short outline of the revaluation procedure and importantly, a strategy for minimising your rates liability following revaluation.

The Procedure:

1. Each ratepayer will have received a revaluation information form from the Commissioner of Valuation, which they are obliged to complete and return to the Valuation Office.

2. A Revision Officer from the Valuation Office may carry out a physical inspection of the premises.

3. This year each ratepayer will receive a Provisional Valuation Certificate from the Commissioner of Valuation detailing the new rateable valuation.

4. A ratepayer has a 28 day period from the date of the provisional Valuation Certificate in which to make representations to the Commissioner of Valuation contesting the valuation.

Negotiations will then take place during 2012 and 2013. This process is known as the "Representation Stage".

5. Following negotiations, the Commissioner of Valuation will then issue a Valuation Certificate to the ratepayer detailing the new valuation. Valuation certificates will be issued towards the end of 2013.

6. If dissatisfied with the valuation contained in the Valuation Certificate, a ratepayer may appeal to the Commissioner of Valuation. This process is known as the "Appeal Stage".

7. The appeal must then be lodged within 40 days following the issue of the Valuation Certificate.

8. The new valuations will come into effect for rates as and from 1st January 2014.

A Strategy for minimising your rates liability following revaluation:

It is essential that all proposed valuations are scrutinised when the proposed Valuation Certificates are first issued by the Commissioner of Valuation.

This is extremely important because of the provision included within Section 3 of the Valuation Act known as "Material Change of Circumstances".

This section means that following the revaluation scheme, if a rateable valuation is uncontested, a ratepayer has no legal grounds for contesting the valuation in future years if no physical change in circumstances has occurred to the premises.

Accordingly, it is crucial that the valuation is scrutinised and where necessary, contested when the proposed Valuation Certificate is published during 2012.

From our experience, the lowest valuation is achieved when the ratepayer enters into negotiations with the Valuation Office at the representation stage rather than leaving it until the appeals stage.

When making representations, the ratepayer must state why they believe the proposed valuation is incorrect, what they believe it should be, their method of calculating the valuation and market evidence at the date of valuation.

It is anticipated that the next rates revaluation scheme will not be carried out in the Dublin City Council area for 10 years. Accordingly, it is important that all ratepayers in this area are prepared and seek professional advice.

Up to 25,000 properties are being revalued in Dublin city this year and it is anticipated that all Provisional Valuation Certi-ficates will be released on the same day.

Bearing this in mind, ratepayers should get advice now to ensure that sufficient time is available to prepare the best case for properties.

Lisney has a specialised rating department that exclusively deals with revaluations and appeals of rateable valuations on a full time basis.

We have gained considerable experience in dealing with the Valuation Office over many decades and have been successful in reducing many of our client's rates liabilities by negotiating with the Valuation Office at both representation stage and appeal stage.

Tom Davenport is the rating surveyor at Lisney

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