If you haven't heard about the new levels of commercial rates for non-domestic premises in Northern Ireland over the past few weeks, where have you been?
The new system introduced by the Department of Finance aimed to bring rateable values back into line with current property values (given that the last valuations were in 2015). However, with uncertain times ahead for businesses occupying the 74,000 non-domestic properties in Northern Ireland, many owners have been outraged by the sharp increase in their rates charges.
This appears perhaps most evident in the hospitality sector with rates more than doubling in most cases and some establishments increasing up to 500%.
A massive 90% of hotels have seen their net annual values (NAVs - a figure given for an annual rental value at a point in time) increase, which has had a knock-on effect on the sums due to Land & Property Services. As a leading commercial law firm with expertise in the hospitality sector, many of our clients are concerned about this major blow to their industry. We are hearing from our clients that this is in addition to the uncertainties of Brexit and other challenges such as increasing minimum wage provisions and labour shortages.
The process is said to be 'revenue neutral' with lower bills offsetting those facing higher amounts. However, the new Finance Minister, Conor Murphy, has come under increasing pressure to alleviate the concerns of the business community. Whilst there is clearly relief and optimism in the local market regarding the return of the Stormont government, many of our clients remain sceptical as to the practical benefits they will receive.
Can anything be done to challenge what you believe to be a disproportionate rates increase? Absolutely.
Whilst challenges cannot be formally lodged until April 1, 2020, preparation is key. Be proactive now before your bill is issued to prevent an immediate obligation to pay.
Engagement with Land & Property Services is essential and professional advice regarding your position is highly advisable before contacting LPS as NAVs can go up as well as down.
Our expertise in the property and hospitality sectors means we are tuned into the relevant issues. We work as part of your team to achieve the best possible resolution.
The advice is clear - don't just sit and wait for your rates bill. Taking action now may be of massive financial benefit to your business.
At Mills Selig, Northern Ireland's leading commercial and law firm, we hope that the reconstituted Assembly will assist in easing the pressures of our clients, especially those within the hospitality industry. It is imperative that those at Stormont recognise that the hospitality sector is a key element of our local economy.
Maeve Fisher is Senior Associate, Mills Selig