Summary: New procedures regulating how to protest rateable value assessments mean that funds holding UK real estate assets through offshore SPVs may struggle to challenge business rates payable.

Owners of empty business properties and occupiers of non-domestic space are liable to pay business rates. The amount payable reflects the assessment of the rateable value of the property made by an agency of HMRC, the Valuation Office Agency (VOA). All rateable values in England and Wales were updated from 1 April 2017.

New procedures for challenging rateable values apply to these updated assessments. Known as “check, challenge, appeal”, the process regulates how ratepayers can protest the rateable value assessments that apply from 1 April 2017. Check, challenge, appeal has challenged foreign businesses. Companies cannot challenge rateable values without registering through a Government gateway. The registration must be made by a named individual, not the company. That individual must pass an on-line identity check, for which a UK passport number is required. And the individual must be authorised by the company to register.

Structures impacted include investment funds, located offshore or in the UK, and which hold UK real estate through non-UK companies. These asset owners are unlikely to have either any employees with a UK passport, or employees authorised to register (professional representatives do not count). And without a registration by an individual, the ratepayer’s surveyor cannot make progress. What to do ? The VOA is looking into it. Or, if the situation was sufficiently severe, a judicial review claim for permission to bypass the gateway can be considered.