AD Business rates

[The Son]

I had a letter from the rating office last month requesting information on my AD plant, which I duly returned.

I have now been hit with a massive business rates bill, backdated to April 2015.

I thought that as a farm based AD I would be exempt has anyone had a dealings with the ratings office, or can point me in the direction of a trusted proffesional, PM if need be.

 

[wilber]

Try speaking with these, a lot on here rate them. https://www.fec-energy.co.uk/

 

[thesilentone]

Maybe of some help to you, what made you think that a on-farm plant was exempt ?

http://www.organics-recycling.org.uk/uploads/article3004/150430 REA business rates MDeans.pdf

 

[Bob]

If you had been upfront and notified the valuation office that you had an AD plant before April last year you would have been able to claim transitional relief. What do you call a massive rates bill.? 500Kw wind turbines here got a 300% increase from April 17 but transitional relieve make the rise neglible

 

[The Son]

Thanks for the info.

Having only been involved in agriculture business rates have never been on my radar. Whilst I admit its my bad for not checking, the numerous advisors I had whilst building the plant failed to tell me as well.

The rates are being backdated to April 2015, so I am facing a £30k bill now, with an ongoing £20k a year until the next revaluation.

The valuation does puzzle me though, in my mind the plant was at its most valuable the day that it was commisioned, as it had 20 years of fits in front of it, every year it getscworth less until 2033, when the fits run out and the plant becomes valueless, unless there is another fit scheme available at that time.

 

[Bob]

Have you compared your valuation with other similar sized projects. The VO seem to have changed the rules somewhat for fit installations using receipts and expenditure instead of the tradition open market rental value.
There are a number of installation near here not even rated whilst I have to fork out 30k a year

 

[goodevans]

Thanks for the info.

Having only been involved in agriculture business rates have never been on my radar. Whilst I admit its my bad for not checking, the numerous advisors I had whilst building the plant failed to tell me as well.

The rates are being backdated to April 2015, so I am facing a £30k bill now, with an ongoing £20k a year until the next revaluation.

The valuation does puzzle me though, in my mind the plant was at its most valuable the day that it was commisioned, as it had 20 years of fits in front of it, every year it getscworth less until 2033, when the fits run out and the plant becomes valueless, unless there is another fit scheme available at that time.[/QUOTE

are the fit s not designed so as the plant is paid for after 20 years and is then viable to run at lower income as repayments are then not needed

 

[The Son]

No, the plant will not be viable without fits, the engine and plant cost too much to run, it might just be ok if you have feedstock delivered for free.

 

[The Son]

Have you compared your valuation with other similar sized projects. The VO seem to have changed the rules somewhat for fit installations using receipts and expenditure instead of the tradition open market rental value.
There are a number of installation near here not even rated whilst I have to fork out 30k a year

Thats a lot, l am 400kW, what are you?

Have you tried any sort of appeal

 

[Bob]

Thats a lot, l am 400kW, what are you?

Have you tried any sort of appeal

Spoke to the VO early last year when I found out about the increase. The chap seemed very clued up with the revenues received through fits. He sent through the figures on how they come to the RV. Seems very complicated and left me feeling I may be even worse off if I had to send actual evidence of income and expenditure which they would probably want to see
I can’t help but feel it’s a method of clawing some of the tariffs back
Like you when studying the feasibility of this no one ever mentioned business rates

 

[young wilf]

I had a letter from the rating office last month requesting information on my AD plant, which I duly returned.

I have now been hit with a massive business rates bill, backdated to April 2015.

I thought that as a farm based AD I would be exempt has anyone had a dealings with the ratings office, or can point me in the direction of a trusted proffesional, PM if need be.

If you would like to PM me I can hopefully help you out - there are a lot of us in the same boat. Would PM you myself but can't work out how to do it!!

 

[The Son]

PM sent

 

[Exfarmer]

My understanding! Is that if the bulk of the generation is used bythe agricultural business then it wualifies for agricultural relief. If the bulk is exported , then it is rateable as any other generator is.

 

[The Son]

25% of electrical output, and 100% of heat output is used on site, I put this in the document I submitted, but it doesn't seem to have made a difference.

 

[thesilentone]

Farmers urged to check business rates changes for energy projects
Paul Spackman
Thursday 10 November 2016 6:00

© Tim Scrivener
Farmers with renewable energy projects hit by a planned hike in business rates have just a few months left to query the new charges before they come into effect next April.

Draft rateable values used by councils to calculate business rates were published online by the government’s Valuation Office Agency (VOA) on 30 September alongside plans to remove the exemption for microgeneration (sub-50kW) schemes.

There has been strong opposition to the plans, with industry bodies calling on government to reconsider increased rates and make microgeneration permanently exempt.

See also: Farm energy opportunities remain despite Brexit uncertainty

Although agricultural land and buildings are generally exempt from business rates, many farm-based energy projects will be caught by the changes.

The NFU opposes plans to make current microgeneration installations rateable from 1 April 2017 and says the VOA needs to be careful when deciding what rateable value to use.

In particular, it says ambiguity must be resolved around what exceeds the de minimis (minor use) allowance for non-agricultural use of the energy generated.

The threshold is currently around 5%, which means that if more than 5% of electricity is exported or used for non-agricultural uses the whole installation is likely to be liable for business rates.

The NFU also says the VOA must consider that energy generated and consumed on-farm will fluctuate throughout the year making it difficult to calculate a rateable value.

© Tim Scrivener



While much attention has been given to the impact of business rate changes on commercial roof-mounted solar, where rateable values could increase by six to eight times for those that own their panels and use most power themselves, all technologies are affected, says Dan Thory of Fisher German.

Rateable values for typical farm-scale wind turbines (up to 500kW) could be hardest hit, as new rates are two to three times the existing average of £25,000/MW (£25/kW), he says.

Older turbines face higher bills than those installed more recently due to the fall in renewable subsides, which is reflected in the VOA revaluation, he notes.

However, rates for many anaerobic digestion plants appear to have fallen by 20-30% under the new RVs. This may be because existing rates for AD plants have been very high (up to £150,000/MW), well above rates for other renewable technologies, Mr Thory adds.

Small ground-mounted solar PV could also benefit, as some new rates appear to have dropped by 30-40%. The current average is £8,000/MW (£8/kW).

Agricultural exemption
In addition, farm-based roof-mounted systems usually get an agricultural exemption although this can depend on the proportion of energy used on farm compared with that exported.

Properties with an RV of £12,000 or less potentially qualify for Small Business Rates Relief, set to rise to 100% from April 2017. Tapered relief will also be available for properties with an RV between £12,001 and £15,000, Mr Thory says.

Ratepayers have until 31 March to query with the VOA to check the basis of the revaluation and if appropriate, to challenge it. “Don’t wait until after rates come into effect as it can then only be done through the appeals process, which is becoming harder and more long-winded,” says Mr Thory.

Rateable values can be checked on the government website.

*The Solar Trade Association recently signed an agreement with the VOA which means most solar systems exporting to the grid, or via a Power Purchase Agreement to tenants, will see a decrease in business rates, reflecting falling costs, and lower subsidies.


http://www.fwi.co.uk/business/farmers-urged-to-check-business-rate-changes-for-energy-projects.htm

 

[e3120]

Success!

Sent off my form for my Endurance turbine to the county council for small business exemption last week, had credit back into bank account yesterday for all rates paid to date. And here's me preparing for months of chasing, arguing etc.

The criterion was <£12k rateable value, which mine is a little below. Much easier than challenging valuation agency, who were making it very hard work to even get the right to an explanation of the calculation.

 

[Still Farming]

Valuation Office Agency ,HMRC ,TAX ,VAT , Council after every penny ???