Bradley Stoke Town Council (BSTC) has been stung by a massive hike in the business rates it has to pay for the Jubilee Centre following the discovery of a clerical error made by HM Revenue and Customs (HMRC) in 2005.
This week’s meeting of the Council’s Finance Committee was told that a “manual error” within the records held by HMRC’s Valuation Office Agency (VOA) resulted in the rateable value of the main building being recorded as £1,071.60 instead of £10,713.60.
The under valuation has been in place since 2005 and BSTC has therefore benefited from a substantially reduced rate level for almost five years.
Councillors were told that the VOA has waived its right to retrospectively claim the underpayment but were disappointed to hear that the new rate is to be applied from January rather than from the start of the new tax year in April.
Had the increase been applied from April, it would have coincided with a five-yearly rate review and under ‘transitional relief’ rules the new rate would have been phased in over a four to five year period. As the April increase is now unlikely to trigger ‘transitional relief’, the new rate will have to be paid in full with immediate effect.
The additional rates arising from the corrected rateable value are believed to be between £4,000 and £5,000 per annum.
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