COMPLETION NOTICES ON UNCOMPLETED PROPERTY
A ruling in a recent court case is interesting for anyone who has built but not yet completed a commercial property. In the recent Aviva Investors Property Developments Ltd and PPG Southern Limited v Margaret Whitby (valuation officer) & Adrian Mills (Valuation officer) 2013 case, the billing authorities had failed to serve completion notices. An enquiry was subsequently carried out to determine whether the properties in question were ready for occupation on the date they were included in the rating list and therefore, had to commence paying business rates.
The Aviva appeal related to a warehouse at Reading Approach in Berkshire, and PPG’s appeal focused on a building at Torc:MK industrial park, Milton Keynes. It was a landmark case for 60 similar disputes over whether new-build property can be assessed for rates purposes if it is not yet ready for occupation. Its immediate impact is that approximately £20m of liability paid by ratepayers has been charged in error, but the long-term implications are far greater.
The decision will encourage many property owners to seek to alleviate the rates payable on unoccupied properties by holding off completion. Property owners should be aware that where the billing authority serves a completion notice on an uncompleted property, that notice must be appealed in order to avoid inclusion on the list.
The Valuation Office Agency is unable to register a new-build property into the rating list and assess its rateable value until it is considered legally ready for occupation. The only exception is if the local authority issues a completion notice confirming that the premises will be completed within three months. The tribunal has now held that certain key features vital to occupation for the purposes for which the properties were constructed to be occupied must exist before those properties can be entered in the rating list and rates demanded.
The decision proves that an empty rates liability cannot affect a new building unless a valid completion notice has been served or the property is ready for immediate occupation.
For more information contact Paul Burbidge firstname.lastname@example.org