Published: 4th January 2017
Business rates are an inevitable cost when it comes to running your business from a commercial premises. The amount you have to pay is determined by what is known as your property's 'rateable value' (RV). This figure is in part based on the property’s open market rental valuation.
The current rates were set in 2010, based on valuations conducted in 2008, however this is set to change. This year marks the first revaluation of business rates for seven years, and while some businesses will see little change or even enjoy a welcome reduction in the amount they pay, for others the news is not as good.
With the new rates set to take effect from April 2017, businesses up and down the country are preparing themselves for a costly start to the year, with significant increases being seen up and down the country. Somewhere not immune to this is Aberdeen, which has been particularly badly hit with widespread business rate increases.
The problem stems from the latest assessment being conducted in April 2015, a time when the commercial property scene in and around the Aberdeen area was buoyant. Unfortunately since then the effect of the slump in oil prices has had severe repercussions for the city. This has left Aberdeen’s business-owners paying business rates which do not accurately reflect the current economic situation.
As the revaluation of rates is typically conducted only every five years, the current rise is set to impact on Aberdeen’s businesses for years to come.
This is undoubtedly damaging to a region already struggling in the wake of the oil price crash, and only serves to pile further stress onto struggling business owners. While some may be able to pass some of the extra costs on to their customers, others may be forced to take a hit on their profits in the hope that business picks up in the future. Unfortunately for a number of struggling businesses, this price hike could be the final blow that signals the end of their already fragile business.
If you fear the imminent rise in business rates will leave you struggling to cope, we could help. Experts within Real Business Rescue’s Aberdeen office have advised numerous people who have found their businesses negatively affected by the recent downturn in the city.
If you are struggling with mounting financial pressure, call one of our experts to arrange a confidential meeting free-of-charge. We have experts located in Aberdeen, who understand the current situation in the city and the problems you are up against. With 78 offices stretching from Inverness down to Exeter, Real Business Rescue can offer unparalleled director advice across the UK.