Rating Manual - Volume 2 - Section 7 : List Alterations without Service of VO Notice and the Impact of Address-only Changes

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1. Notifications to the Ratepayer

1.1 N.B. All references to regulations are to The Non-Domestic Rating (Alteration of Lists and Appeals)(England) Regulations 2009 (SI 2009/2268) or

The Non-Domestic Rating (Alteration of Lists and Appeals)(Wales) Regulations 2005 (SI 2005/758) , unless otherwise stated.

Generally a ratepayer has to be notified of all changes to a Rating List (see Regulation 17 Notification of alteration). There are exceptions, which are set out in Regulation 17(3).

1.2. The exceptions are: -

Alterations effected solely for the correction of clerical errors or for reflecting:

  • Changes of address
  • Boundary changes

1.3 In respect of Para a), b) and c) below the VO does have to serve a Notification of Alteration but not notification of rights of appeal [Reg 17 Para (4)]

  • Well founded proposals
  • Agreements in respect of proposals
  • Decisions of a VT or the Upper Tribunal

1.4 Where there is any doubt as to whether or not any notification is required, VOs should seek advice from the NSU (Local Taxation) Technical Adviser.

2. Notifications to the Billing Authority

2.1 Regulation 17(1) makes provision for the Billing Authority to be notified of all changes including those for which notification to the ratepayer is not required.

2.2 This requirement is fulfilled when the Billing Authority is served with Schedules of Alterations and Minor List Changes Schedules.

3. Definition of a Clerical Error

3.1 There can be no definitive explanation as to what exactly constitutes a clerical error. In general, however, a clerical error could occur in a number of ways including misinterpretation of instructions, arithmetical errors, incorrect computer operation, etc. However, as a matter of policy any error in a Rating List, the correction of which could affect a ratepayer’s liability e.g. any alteration to the description or rateable value, should not be treated as a clerical error unless the correction can be supported by 'external' documentation such as an agreement form or Tribunal decision.

4. Errors in the VO Notice of Alteration

4.1 If an error occurs in any Notice of Alteration sent to a ratepayer, whether or not a proposal against the alteration has already been received a correction should always be made by serving a fresh Notice, notwithstanding the four week time limit specified in Reg 17(1). This has no effect on the validity of the alteration made by the VO and does not create or extend any period within which a proposal may be made.

5. Entry of a Property into the Wrong Rating List

5.1 If a property is inserted into the wrong Rating List, usually by entry of the incorrect billing authority code, the ratepayer should be notified of both the deletion and also the alteration of the List for the new entry. This will entitle proposals to be made against either alteration.

6. Alteration of Property Address

6.1 Any alteration to the address of a hereditament in a Rating List falls under the exception in regulation 17(3) [see paragraph 1 above] and is legally classed as a minor rating list alteration for which no notification is required by law, but for operational reasons certain address changes should be notified to ratepayers in the same way as any other list changes.

6.2 Business Rates Information Letter 05/2002 issued by the DTLR (now DCLG) to BA’s Chief Finance Officers confirmed that address only changes should not affect rate liability and that these changes will be shown on the separate Minor List Changes Schedule. However, this schedule only contains alterations made by MRL case-types and consequently many address-only changes will not be shown in the Minor List Changes Schedule if they have been effected by VOR/BAR case-types.

6.3 A minor rating list alteration should have no effect on liability whether it is carried out by an MRL case-type or otherwise and therefore where an alteration to the address makes the existing list entry ‘historic’ consideration must be given to the effect on any IPP, VOR or BAR linked to the historic entry.

6.4 It is important to distinguish between “minor rating list alterations”, which include ALL address changes, and those made using the MRL (Minor Rating List) case type:

7. Change of Address by MRL Case-type

7.1 A detailed description of the MRL case-type is given in the NDR Procedures Manual.

7.2 An MRL case-type directly over-writes the address appearing in the database and ripples through to outstanding and settled cases, to other applications, such as CRAC and to previous list years and no record of the former address is retained on the system. For this reason it must only be used for minor corrections to spelling of Firm’s Name, Number/Name or Postcode elements of addresses, e.g.

from:

"Jhon Smith 1, High Street, Anytown, CT2O 2TP"

to:

"John Smith 1, High Street, Anytown, CT20 2TP"

7.3 If an MRL case-type could be used to make alterations to the street, town or county elements of an address it could prove impossible to tie up paperwork, such as a proposal, associated with the earlier address, and this is why these elements of the address structure cannot be altered by MRL case-type. An MRL case-type should not be used for a significant change to any part of the address. A significant change is one that results in an address that is likely to be interpreted as relating to a different hereditament.

7.4 For the same reason, it would cause confusion to the ratepayer if a significant address change is effected by an MRL case-type since no Notice is produced by RSA and the ratepayer would be unaware that the entry had been changed. Whilst there would be no effect on rate liability it is likely to give rise to a complaint if a ratepayer who has been used to receiving bills in respect of, for example:

"John Smith 1, High Street, Anytown, Kent, CT20 2TP"

without Notice started to receive bills in respect of:

"Joe Bloggs 25, High Street, Anytown, Kent, CT19 1XX"

7.5 Any such change must be made by use of a VOR/BAR case-type and notwithstanding the provisions of Regulation 17(3) which do not require notification to be served, good practice dictates that a Notice type G (VO7011c – Significant Address only change) should be sent.

This will have no effect on rate payment liability and should attract no subsequent appeal

7.6 An MRL case-type must also not be used for ANY alteration where an outstanding IPP has been transmitted to the Valuation Tribunal Service (VTS) as this will cause integrity problems between the VOA and VTS computer systems.

8. Change of Address by VOR or BAR – Impact on IPP’s

8.1 As described above, where the change in the address is significant it must be carried out using a VOR/BAR “one to one” reconstitution case type (Reason for Report code ‘10’) and Notice type G should be sent. This notice must only be sent if there has been no change in the unit of assessment (i.e. Not splits/mergers) or the rv.

8.2 Where an address is changed by VOR/BAR report code 10 the assessment status of the previous list entry will become “3 – Previously Current” and any IPP linked to it will become “historic”.

8.3 This has caused difficulties in the past where a proposal challenging the RV in the compiled list has been rendered “historic” by a VOR address change and no proposal had been made in response to the address alteration. The VOA interpretation of the regulations meant that no effect could be given to any reduction agreed in respect of the “historic” proposal:

 

Action

Effective Date

RV

Address

Comments

1.

Compiled List

1/4/00

£10,000

1, High Street, Anytown

 

2.

IPP made 1/9/00 against compiled list RV

     

Linked to 1. above

3.

VOR Report Code 10 on 1/10/00 (makes 1. above “historic”)

1/4/00

£10,000

1A, High Street, Anytown

Becomes “current” entry for liability

4.

IPP settled 1/5/01 against “historic” entry

1/4/00

£9,000

1A, High Street, Anytown

“Historic” status – reduction has no effect for liability

8.4 Following representations by the rating professional bodies DCLG have now indicated address-only changes are to be treated as minor rating list alterations and the correct approach to adopt is now as follows:

9. Compiled List IPP made “Historic” by address-only change – Pre-2005 lists

9.1 The IPP must remain linked to the historic compiled list entry and upon settlement should be cleared in the usual way. This will result in an historic only alteration of the RV at compilation date.

9.2 As soon as the IPP case has been subject to QA procedures a VOR, Report reason 11, must be raised and linked to the “current” address. The non-standard reason for report must be input as “Pursuant to IPP XXXX”, where XXXX represents the case number of the IPP.

9.3 The normal limitations on the Effective Date imposed in respect of 2000 lists by Regulation 13A of the Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 1993 SI No 291 will not apply to the VOR case because it is giving effect to the agreed proposal and consequently the date to be used will depend on when the proposal was made, for example:

Compiled List

1, High Street

£10,000

01/04/2000

IPP made 1/5/00

     

VOR address-only 1/6/00

1A, High Street

£10,000

01/04/2000

IPP agreed 1/5/03

1, High Street

£9,000

01/04/2000 “historic”

VOR Code 11

1A, High Street

£9,000

01/04/2000 “current”

9.4 The Effective Date in this example will not be limited because the IPP would not have been limited. However, if the circumstances are different:

Compiled List

1, High Street

£10,000

01/04/2000

VOR address-only 1/6/00

1A, High Street

£10,000

01/04/2000

IPP made 2/4/03

     

IPP agreed 1/6/03

1, High Street

£9,000

01/04/2003 “historic”

VOR Code 11

1A, High Street

£9,000

01/04/2003 “current”

9.5 The Effective Date will be restricted to the start of the rate year in which the IPP was made.

9.6 The intention is to ensure that the proposer is not disadvantaged by the address-only change and the Effective Date is therefore the date that would have applied if the address had not been altered.

Compiled List IPP made “Historic” by address-only change – Post -2005 lists

9.7 For the avoidance of doubt, the principle behind these instructions apply equally to 2005 and 2010 list proposals and although there are less likely to be circumstances where the effective date of a compiled list correction will be limited by regulation 14 of the appeal regulations, because of the restrictions on making proposals contained within the Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 2009 a slightly different procedure should be applied:-

Where the VO alters a list entry to correct the address with effect from compilation date, any outstanding proposal should be re-linked to the new address. This ensures that any fresh proposal will be flagged as a potential duplicate. Agents or ratepayers should not be asked to withdraw proposals solely on the grounds that the list entries to which they are linked have been made historic by an address-only change.

10. Post-compilation IPP made historic by address-only change

10.1 Where an IPP is linked to a list entry that arose from a post-compilation alteration, such as a reduction following an MCC, and it is made historic by an address-only change the IPP must remain linked to the historic MCC list entry and upon settlement should be cleared in the usual way. This will result in an historic only alteration of the RV.

10.2 As soon as the IPP case has been subject to QA procedures a VOR, Report reason 11, must be raised and linked to the “current” address. The non-standard reason for report must be input as “Pursuant to IPP XXXX”, where XXXX represents the case number of the IPP.

10.3 The normal limitations on the Effective Date imposed in respect of 2000 lists by Regulation 13A of the Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 1993 SI No 291 will not apply to the VOR case because it is giving effect to the agreed proposal and consequently the date to be used will depend on when the proposal was made, for example:

1.

Compiled List

1, High Street

£10,000

01/04/2000

2.

MCC VOR

1, High Street

£9,000

1/05/2002

3.

VOR address-only 14/06/02

1A, High Street

£9,000

01/06/2002

4.

IPP made 1/7/02 against VOR at 2. above

1, High Street

£9,000

1/05/2002

5.

IPP agreed 1/7/03

1, High Street

£8,000

1/05/2002 “historic”

6.

VOR Code 11 linked to 3. above

1A, High Street

£8,000

01/06/2002 “current”

10.4 The Effective Date in this example will not be limited because the IPP at step 4. was made within 6 months of the VO alteration at step 2. and therefore would not have been limited. However, if the circumstances are different:

1.

Compiled List

1, High Street

£10,000

01/04/2000

2.

MCC VOR

1, High Street

£9,000

1/05/2002

3.

VOR address-only 14/06/02

1A, High Street

£9,000

01/06/2002

4.

IPP made 1/5/03 against VOR at 2. above

1, High Street

£9,000

1/05/2002

5.

IPP agreed 1/7/03

1, High Street

£8,000

1/04/2003 “historic”

6.

VOR Code 11 linked to 3. above

1A, High Street

£8,000

01/04/2003 “current”

10.5 In this case the IPP was made more than six months after the MCC alteration and therefore the Effective Date will be restricted to the start of the rate year in which the IPP was made.

10.6 Again, the intention is to ensure that the proposer is neither disadvantaged nor gains any advantage by the address-only change and the Effective Date is therefore the date that would have applied if the address had not been altered.

10.7 The advice in paragraph 9.7 above does not apply where the change of address had effect from a day later than compilation. In these circumstances the proposal should remain linked to the historic compiled list entry and if its settlement results in an alteration to the rateable value this should subsequently be applied to the current address by raising a VOR case, as described in paragraph 9.2 above.

11. Action in Respect of Settled Cases

11.1 It is not anticipated that VOs will trawl through settled cases to identify any 2000 list case that would have met the criteria outlined above. However, VOs may be approached by ratepayers or their advisers about cases settled before the issuing of this guidance and where the VO is satisfied that the circumstances described above would have applied he should take action to correct the “current” RV in the same way as for an outstanding case. For the avoidance of doubt this does not extend to the 1995 list.

11.2 In cases of doubt advice should be sought from the relevant NSU Technical Adviser.

12. General Street Renaming and/or Renumbering

12.1 Refer to the ITSD manual for the renaming and/or renumbering of streets including the insertion of new streets. Also refer to: IT Training - Address Application Page.

13. Effective Date of Address-Only Changes

13.1 In respect of pre 2005 lists:

Under Reg 13A(13A) of the Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 1993 SI No 291:

“(13A) Subject to paragraph (14), an alteration made to correct an inaccuracy in a list (other than an alteration which falls to take effect as provided in the foregoing provisions of this regulation) shall have effect from the day on which the list became inaccurate.”

This allows the crossing of the financial year barrier but not altering previous Rating Lists (i.e. the 1995 list). See also paragraph 6 above in respect of alterations pursuant to “historic” proposals. However, somewhat bizarrely, where the error in the address existed at compilation, the correction will fall under regulation 13A(2) and will be limited to the start of the financial year in which the alteration is made (or the proposal is served). Alterations to make address-only corrections to 2000 lists by VO’s are not permitted after 31 March 2006 other than pursuant to an existing proposal.

13.2 In respect of post 2005 lists:

Under regulation 14(2):

“(2) Subject to paragraphs (3) to (7), where an alteration is made to correct any inaccuracy in the list on or after the day it is compiled, the alteration shall have effect from the day on which the circumstances giving rise to the alteration first occurred.”

Consequently, there is no restriction on the effective date of an address-only change and such an alteration may take effect from the appropriate day, up to and including compilation date.

14. Procedures

14.1 The RSA procedure for Minor Changes to the Rating List is set out in NDR Procedures Manual.

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