SMEs overpaying on business rates

Link: Businesses to flee London over insurance costs

KPMG is urging SMEs to challenge the rates charged on their commercial property, saying cases it had worked on resulted in average savings of 20%, in many cases the difference between making a profit or a loss.

Reassessment of the business rate could be triggered by changes to utilisation and occupancy of the property, including such things as moves, relocations, closures, mothballing and even retooling.

Mel Egglenton, head of middle markets at KPMG, explained: ‘When it comes to the cost of renting commercial property, most businesses will put a lot of time and effort into ensuring that they get the best deal possible.

‘However, they do not challenge the costs of their second largest occupancy outlay – business rates – with anything like as much zeal and, as a result, are often over-paying on their rates. The savings that can be made are often really significant for small and medium-sized companies.’

Businesses were also warned that business rates will be reassessed in 2005, taking into accountant movements of rental values over the last five years, and they should expect substantial increases.

Related reading