Government’s Valuation Office Agency ‘aggressively pursuing’ hospitality fines

The Government Valuation Office Agency (VOA) has been accused of “aggressively pursuing” an increasing number of fines for late Valuation Forms of Return, according to Colliers’ business rates team.

This is despite many such businesses being closed during the pandemic with no-one in the office when the forms were issued.

Businesses have 56 days to return the forms, after which they receive a £100 penalty. If the information has still not been provided within the next 21 days, a further £100 penalty notice is issued, and from this date a charge of £20 a day is added to the total sum owed until the information is provided. The maximum penalty amount is £500 or the property’s rateable value, whichever is greater, and can run into thousands of pounds.

Forms of Return provide the VOA with information about a business’s property, such as rent, lease and ownership details, enabling the VOA to work out the rateable value of the property, which is then used to calculate business rates.

The forms also ask for detailed trade figures for the three-year period (2019, 2020 and 2021), during which many hospitality businesses were closed for long periods and many staff were furloughed. Businesses that have been unable to collate all the necessary information to make the returns in time are finding themselves facing ever-increasing fines, even when some businesses were making a zero return in the period, according to Colliers.

John Webber, head of business rates at Colliers, said it was “totally inappropriate”.

He said: “We are seeing an increasing number of businesses coming to us to help sort this out, some of them with fines going into hundreds of pounds or more, particularly if there are a number of properties in their portfolio – as form-filling wasn’t the key priority for such businesses in the pandemic.”

Colliers said one hotel client that has more than 50 properties across the UK received the initial forms when staff shortages were at their highest and a delayed response from the VOA led to further time penalties.

Webber added: “Does the VOA really think this is a sensible way to behave? Such businesses have seen a difficult two years with lockdowns, furlough schemes, staff shortage and increased prices, not to mention pre-Christmas edicts about working from home and avoiding socialising. Surely they should be given some slack if they are slightly behind with the paperwork? Particularly when that paperwork has been made increasingly detailed and complicated to fill in?

“The drop in trade over December for pubs, bars, cafés and restaurants is still coming home to roost with estimates that trade fell by a third. It is disappointing the VOA is not showing a more conciliatory approach to a sector just coming off its knees.”

A VOA spokesperson said: “Our priority as an agency is making sure ratepayers are charged the right business rates through producing reliable and accurate valuations. To do this we need as much information as possible about their properties and any changes.

“We are clear that penalties are a last resort, which is why we send several reminders for customers to return their information and have support available for those who need help completing their form. We also paused issuing fines for the hospitality sector at the start of the pandemic until restrictions had been lifted.”

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