Discretionary Business Rate Relief Policy
Discretionary Business Rate Relief Policy - Refresh 2023
1. This policy -
(i) sets guidelines for the factors that should be considered when making a decision to award or refuse relief
(ii) establishes a framework to ensure applications are dealt with in an efficient manner
(iii) sets out the delegated authority to award relief in the appropriate circumstances
(iv) establishes an appeals' procedure for organisations that are dissatisfied with the Council’s decision
(v) seeks to safeguard the interest of local taxpayers by ensuring that funds allocated for the award of discretionary rate relief are used in the most effective and economical way.
2. The aims of the Discretionary Rate Relief (DRR) policy are -
(i) to encourage community participation and in turn to support community cohesion
(ii) to promote access to membership and activities
(iii) to provide assistance, where possible, to disadvantaged individuals and groups
(iv) to support those organisations which actively enhance the Council’s priorities in the Council’s 5-year plan “Reigate & Banstead 2025”.
3. The following criteria are to be used to assess an application for discretionary rate relief in respect of a non-profit making organisation –
(i) the extent to which the organisation is local
(ii) membership arrangements for clubs - is membership restricted, are the fees excessive?
(iii) membership consistency - what percentage is drawn from the authority residents?
(iv) facilities - are there particular features for vulnerable or needy groups e.g., disabled, elderly, youth groups, minority groups
(v) are there specialist facilities which -
- would otherwise be provided by the Council; or
- are of particular Welfare to the community aimed at Reigate and Banstead residents; or
- are used as a focal point for Reigate and Banstead residents; or
- provide Specialist Training/skills for the young or broader training, e.g., disabled or training specialists to pass on skill to service users
(vi) DRR will not be granted to any organisation which could qualify for the maximum amount of Small Business Rate Relief (100%). In such circumstances they should apply for that relief instead.
4. In addition to the above the following conditions must also be fully met for the organisation to be considered for any relief –
(i) the organisation must be likely to continue operating even without Council help
(ii) the organisation is Reigate and Banstead specific and exists to support local residents or others operating within Reigate and Banstead’s boundaries.
Application process
5. Voluntary and community organisations currently paying rates should complete an application form and return it with a copy of -
- constitution or similar document (e.g., club rules, memorandum and articles); and
- most recent accounts
- membership fees
- bar menu/price list if applicable
- any other supporting explanatory information.
The purpose of the Discretionary Rate Relief Scheme
6. The aim of the scheme is to award a grant aid towards non-domestic rates payable by non-profit making organisations, voluntary and community groups. The award of a grant will enable these groups to use their resources to achieve the aims of the scheme.
7. The award is a percentage of the total rates charge for the year, and not an amount. Therefore, an increase in rate charge for the year would lead to an increase in the relief awarded.
Award arrangements
8. An application form is available for all applicants to allow them to indicate their status and their application for the appropriate reliefs. A senior officer in Business Rates and a second designated officer independently review the applications with a recommendation on the appropriate levels of relief. For distinct separation of duties, the mean of the two independent scores is then calculated and applied by a different third member of staff.
9. Mandatory relief can apply to national and local organisations alike with many national charities receiving relief, particularly with the development of charity shops, and quite often an application for discretionary relief is made with the application for mandatory relief.
10. To ensure conformity in dealing with applications the policy will be to only award discretionary relief to charities or organisations, which wholly or mainly benefit Reigate and Banstead residents, or support the priorities in the 5-Year Plan (Reigate & Banstead 2025).
11. Where the applicant organisation is a registered charity, the expectation is that the organisation will apply in the first instance for the 80% Mandatory Charity Relief. If the organisation benefits the residents in the Borough, consideration will then be given to an application to award it up to an additional 20% Discretionary Rate Relief.
12. The maximum discretionary relief to be allowed will be the difference between the rate liability, less any other relief, if applicable.
13. For the avoidance of doubt, DRR will only be given against occupied property; applications for relief on empty property will not be considered.
Community amateur sports clubs (CASCS)
14. Property wholly or mainly used by a Community Amateur Sports Club (registered with HRMC in accordance with section 64, Local Government Act 2003.) will be treated as if they are registered charities. Sports Clubs which have set themselves up as such, that have tried to register with HMRC but have not been successful, and that are not run as commercial organisations but run on the same principles as a CASC, will be treated as a not-for-profit organisation for the purposes of DRR assessment. Clubs are expected to have claimed CASC Relief prior to applying for DRR, of up to 80% relief.
Property eligible for Discretionary Rate Relief
15. Property, all or part of which is occupied for the purpose of a non-profit making institution or other organisations whose main objectives are recreational, charitable, philanthropic, religious or concerned with social welfare, science, literature, education or fine arts: or club, society or other organisation and is used for the purpose of recreation.
Determination of eligibility - access and membership arrangements
16. Membership should be open to all sections of the community subject to legitimate restrictions placed on membership for any of the following reasons -
(i) minimum required standard of ability or achievements in activities covered by the organisation
(ii) where capacity of the facility is limited
(iii) where the organisation is providing a service for specific parts of the community, such as young people, women, men, old age, persons with disabilities, ethnic minorities or religious persuasions.
17. The organisation should actively encourage membership from particular groups in the community which are considered to be particularly deserving of support, i.e., young people, women, men, old age, persons with disabilities, ethnic minorities.
18. Membership for the organisation should be of benefit to residents of the borough.
Provision of facilities
19. The facilities provided for members should be made available for other members of the public as far as practicable. The organisation should provide some training or education to its members to develop their skills e.g., young people, the disabled, retired people.
Other considerations
20. The organisation should be affiliated to a local or national organisation as an indication of their involvement in developing of their interests where possible.
21. The existence of a bar should not affect eligibility; the council will look at the main purpose of the organisation. However, consideration will be given of the extent of a subsidised bar menu.
22. Charge for membership, would indicate availability of funds for the organisation, but should not be excessive, and membership should be non-exclusive (see paragraphs 17-19).
23. The Council will consider the cash assets of an organisation applying, which have not been allocated or set aside for any particular purpose. This would indicate an ability to pay the rates.
24. The aims of the organisation must meet at least one of the priorities in the Council’s 5-Year Plan (Reigate & Banstead 2025), which are –
(i) Secure the delivery of homes that can be afforded by local people and which provide a wider choice of tenure, type and size
(ii) Work with partners to create strong, safe and welcoming communities
(iii) Provide targeted and proactive support for our most vulnerable residents
(iv) Provide leisure, cultural and wellbeing services that are accessible to, and meet the needs of, communities and visitors
(v) With our partners, invest in our town and village centres, so they continue to be places where people choose to live, work, do business and visit
(vi) Drive the continued economic prosperity of the borough, facilitate improved business infrastructure, and confirm the borough’s reputation as a great place to do business
(vii) Ensure new development is properly planned and sustainable, and benefits the borough’s communities and the wider area
(viii) Provide high quality neighbourhood services to ensure that the borough continues to be clean and attractive and local people have access to the services and facilities they need
(ix) Reduce our own environmental impact, support local residents and businesses to do the same, and make sure our activities increase the borough’s resilience to the effects of climate change.
Core funded organisations and local partnerships
25. Where a charitable or not-for-profit organisation receives core funding from The Council, DRR will be awarded at 100% of the net liability after other reliefs have been applied.
26. Where a charitable or not-for-profit organisation carries out work on behalf of the Council, and where otherwise the Council would be required to carry out that work, DRR will be awarded at 100% of the net liability after other reliefs have been applied.
27. At the discretion of The Council, where a charitable or not-for-profit organisation would qualify for core funding, although due to budget restrictions is not currently funded, the Council has the discretion to award DRR up to 100% of the net liability after other reliefs have been applied. These organisations must demonstrate that they provide support to local communities and would be at risk of not being able to continue without further relief on their Business Rates. This discretion to award additional DRR may also apply where an organisation has received less than 100% under the scoring system, and there are exceptional circumstances to increase the award. Any decision to award DRR under this paragraph will be done in consultation with the Elected Member with Responsibility for Revenues & Benefits.
Right of appeal
28. There is no statutory right of appeal against a decision regarding discretionary rate relief made by the Council. However, the Council recognises that ratepayers should be entitled to have a decision reviewed objectively if they are dissatisfied with the outcome. The Council agrees to abide by the following appeals process and aggrieved ratepayers should make an appeal in accordance with the process.
29. Ratepayers will be notified of the appeals process in writing at the time that they are notified of the outcome of their request for rates relief. This appeals process does not affect a ratepayer’s legal rights.
Appeals process
30. Appeals may only be made by the original applicant and within one calendar month of receiving the decision following application. An applicant may appoint an agent to act on their behalf and in such cases the Council will require written authorisation from the applicant before dealing with their agent. An appeal should include the reasons why the decision has been disputed, and new information may be provided with the appeal if relevant.
31. Appeals will be dealt with by a manager or Head of Service in consultation with the Elected Member with Responsibility for Revenues & Benefits. The appeal should be considered within 10 working days or receipt of the appeal, and the original decision makers may be consulted to review the application and decision. The outcome of an appeal will be final, and there will be no further process for appeal within this policy. Each application will be considered individually on its own merit.
32. Submitting an appeal does not affect the appellant’s legal rights to challenge a decision made by the Council through the Judicial Review process, and the applicant can follow this process if not satisfied with the outcome of the appeal.
Period of rate relief
33. DRR awarded under this policy will be awarded for the financial year in which the application is received, except where the liability started on a date after 1st April within that year. In this case DRR will start from the start of liability. Repeat applications may be made up to two months in advance of an existing DRR expiring.
34. Where an application is made between 1st April and 30th September, then consideration may be given to awarding DRR for the previous financial year. The maximum period of any award will be across two financial years.
35. Ratepayers will be notified that the DRR award is for a specific period only and that a new application must be made upon expiration for further ongoing relief in subsequent years.
36. In order to comply with Regulation 2.2 & 2.3 of the Non-Domestic Rating (Discretionary Relief) Regulations 1989 as amended by SI. 616 of 1993 Schedule 2, which states that in the case of an authority making a variation of a determination or revoking a decision that it must give at least 1 year's notice, the authority will issue a formal notice notifying the claimant that the award is for one year only or another period as specified.
Cancellation of relief
37. The Council will terminate DRR in such circumstances as –
(i) the applicant ceases to be the ratepayer
(ii) the property becomes empty or becomes occupied by a different liable party
(iii) the use of the property changes
(iv) the aims or objectives of the ratepayer change.
38. Where relief is cancelled for any of the reasons from (iii) to (iv) then a new application may be made straight away.
39. Where there is a change in policy or qualifying criteria, then existing awards will be protected under the policy or version under which the awards were made. Upon re-application, the new policy or version will apply.
Notification of awards
40. The Council will consider applications within one calendar month of receipt of either the application and all supporting information or expiration of a previous award, or as soon as practicable thereafter. Notification of the outcome of the decision will be made in writing within ten working days of the decision being made.
Action to recover unpaid rates whilst a decision is pending
41. Payment of an outstanding liability and instalments should continue to be made whilst an application or appeal is being considered. The Council may decide to exercise its discretion to suspend recovery or court action until a decision is made.
Duty to make correct applications and fraudulent applications
42. The applicant has a duty to declare correct information on all applications, and must not provide false information, or fail to declare a material fact to the Council. During the course of an award, it is the responsibility of the applicant to declare any changes of circumstances which would alter the information provided.
43. The Council may take legal action against any organisation or individual who provides incorrect or false information to the Council, whether fraudulent or otherwise.