Small business rates relief for sports clubs

Small Business Rate Relief:

Sports clubs in England who own their own facilities whether freehold or leasehold and pay business rates may not have to pay any.  This is because they can take advantage of Small Business Rate Relief (SBRR) which is available if the club occupies only one property with a rateable value of £12,000 or less.

Currently if the rateable value is less than £6,000 100% relief is available gradually decreasing from 100% until the rateable value reaches £12,000.

From 1st April 2017 the exempt threshold will be permanently doubled thereby providing 100% relief for clubs with a rateable value of up to £12,000.  A further enhancement means that relief will be available on a decreasing scale for clubs with a rateable value of between £12,001 and £15,000. 

Importantly SBRR is not discretionary it is mandatory. 

Many of our clubs may be eligible for this relief.  Indeed this may be particularly relevant to those clubs that have recently de-registered from the Community Amateur Sports Club (CASC) scheme.   We therefore encourage you to check your rateable value and, if appropriate, apply for the relief. 

More information on the relief can be found here.

Rates - Ability to Pay

Although from April 2017 many smaller clubs will be eligible for rate relief, rates will continue to be an issue for larger clubs or those who have invested in their facilities and for those whose rateable value moves above the £15,000 threshold.

Valuation Office Agency (VOA) guidance exists which is intended to ensure that rate bills for sports clubs are proportionate and directly connected to the financial position of clubs. However it is not clear to what extent the guidance is taken into account by VOA officials or how aware individual clubs are of its existence.

The guidance establishes that if it can be shown that the only occupier of a sports facility is the club then the rateable value of the clubhouse or ground must reflect that club’s ability to pay. The rating system requires that every property is assessed in its existing physical state and alternative uses are generally ignored. This means for rating purposes a golf [sport]club must be considered as a golf[sport] club.

Applying the guidance can have a significant impact on the assessment of a club.  It is therefore important that clubs challenge their valuation where they believe it does not reflect their ability to pay.

The VOA guidance can be found here: (see paras 2 and 5 (ii) in particular).

13th April 2016

 
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