Commercial Rates – Frequently Asked Questions FAQs?
What are Commercial Rates?
Commercial Rates are a local taxation payable on commercial, Industrial and other non-domestic properties, the income from which is used to fund the general provision of services throughout the county.
Why do we pay Rates?
Commercial Rates are the financial contribution business owners and occupiers make to the upkeep and quality of life of the local community. Income received from rates contributes to a huge range of services such as:
- Public Lighting
- Street Cleansing
- Roads and Footpath Upkeep
- Fire Service
- Parks and Open Spaces
- Environmental Protection
- Water Supply & Sewerage
- Heritage, Tourism, Public Amenities and the Arts
- Community Supports and initiatives
Therefore, unpaid rates have a serious effect on Roscommon County Councils ability to deliver essential services to the community
What is the Annual Rate on Valuation (ARV) & how is it calculated?
Following the consideration of the Annual Budget each year, the elected members determine the Annual Rate on Valuation for the following year. The Annual Rate on Valuation is the product obtained when the total shortfall in Council income is divided by the cumulative total of all valuations of rateable premises in the county. The shortfall between the cost of providing all services and the income from Government funding is recouped through the collection of Rates. The Annual Rate on Valuation usually changes in line with the annual rate of inflation.
How are Commercial rates calculated?
The NAV of your property was set by the Valuation Office and can be found on your Valuation Certificate or on your annual rate demand. The ARV will be set by the elected members of Roscommon County Council annually in November.
Your rates are calculated by multiplying the Annual Rate on Valuation, as determined by the County Council, by the valuation on your property, as determined by the Commissioner of Valuation. Your rates can be calculated by reference to this simple example:
Example of Rates Calculation:
€1125.00 per Annum
Who can be held liable for rates?
In general, you must pay a commercial rates charge if you occupy a non-domestic property on the date that rates become payable. This usually happens in January of each year when the rate is struck.
What happens if I don't pay my rates?
Legal proceedings will be initiated for collection of the debt.
Change of Owner or Occupier?
Duty on owners/ratepayers in relation to a transfer of liability for rates - Section 32 of the Local Government Act 2014 places the following obligations on property owners or their agents:
- They must notify the Local Authority where an interest in a rateable property is transferred and as a consequence of this the person liable for the payment of rates has changed
- The person transferring the property, either the owner or occupier, must discharge all rates for which he/she is liable at the date of transfer.
Failure to notify Roscommon County Council of a change in interest within 14 days of the transfer date, may result in a penalty for non-compliance in that, the owner becomes liable for an amount which is equivalent to the level of outstanding liabilities (up to a maximum of 2 years’ liability).
Are rates payable on vacant property?
In cases where the property is vacant at the making of the rate the liability lies with the person entitled to occupy the property at the making of the rate (the leaseholder or if there is no lease - the owner). However, a vacant property may qualify for exemption from rates if the following conditions are met at the making of the rate;
- The bonafide inability of the landlord to obtain a suitable tenant at a reasonable rent
- The execution of repairs/alterations
- Declaration and submission of supporting evidence confirming the fulfilment of either of the above conditions.
A Commercial Rates Vacancy form must be completed and returned annually for vacant properties.
What happens with rates when I am selling or vacating my property?
You must complete and submit a Section 32 Form to the Rates Office within 14 days from the date of the transaction. You will be liable for any commercial rates owed on the property up to the date of sale.
If you are buying a property, it is advisable to check that all rates liabilities are paid up to date on the property. If they are not, they may remain a charge on the property.
I have just opened a new business. Am I liable for Rates immediately?
This depends on whether the property is a new or existing premises. A new commercial premises will need to be valued by the Valuation Office/Commissioner of Valuation, which will involve a visit from one of their valuers. You will receive advance notification of the scheduled visit. If you are taking over an existing commercial premises, then, unless you substantially alter the premises, you will become liable for the existing rates applicable to that property.
What can I do if I am unhappy with the rates I am paying for my property?
The valuation of a property is determined by the Commissioner of Valuation, Valuation Office, Irish Life Centre, Abbey Street Lower, Dublin 1. No alteration can be made to the rates assessment of a ratepayer until such time as the valuation of a property is amended by the Commissioner of Valuation.
When the valuation office value the property, a draft certificate will be issued directly to the occupier /owner. If Rate Payers are not happy with the valuation as determined on the draft certificate, it is critical the occupier/owner make their views known to the Valuation Office at this stage, at no cost. A ratepayer or the Local Authority can seek to have the valuation on a property revised. The completed form should be submitted to the Valuation Office and accompanied with payment of the prescribed fee "The Commissioner of Valuation". An officer from the Valuation Office will call in due course to the property, in order to conduct a revision of the valuation. Further details are available on www.valoff.ie
It is important to note that the revision of a valuation of a property can only be sought in the event of a material change having taken place since the last valuation. The main criteria for satisfying the Material Change of Circumstances (MCC) rule are as follows:
- An existing property which is divided into 2 or more separate properties
- Two or more existing properties which are amalgamated into a single property
- An existing property whose value is changed by virtue of structural alterations (including damage by fire or other physical cause). This refers to a situation where an existing property undergoes structural alterations which affect the value of the property. This usually refers to extensions or other situations where the physical size or nature of the property is significantly changed (either made larger or smaller).
Rates remain legally payable while an appeal is being considered.
Has the Council authority to offset a payment against rates due?Yes. If a payment is due to a person or company and rates are due by the same person or company, the payment may be offset against the rates due.
Can the result of a revision application be appealed?
Following a new/revised valuation on a property, the owner/occupier and Roscommon Co. Council are informed of the outcome, by the Valuation Office. The owner/occupier can appeal the decision to the Valuation Office within 28 days from the issue of notification, for a prescribed fee. The Valuation Office can be contacted at the following address: Valuation Office Ireland, Block 2, Irish Life Centre, Abbey Street Lower, Dublin 2 – Telephone 01 817 1000. A further appeal can be made to the Independent Valuation Tribunal with a further right to appeal via the High Court and ultimately the Supreme Court.
Properties exempt from commercial rates?
A list of properties exempt from commercial rates are clearly outlined in Schedule 4 of the Valuation Act, 2001.
Property Entry Levy (PEL), what is it?The entry year property levy is a charge which the local authority applies to all newly erected or newly constructed properties pending the levying of commercial rates. It was introduced in 2007 under the Local Government (Business Improvement Districts) Act 2006. Commercial Rates will not be charged on any particular building for the same period. The levy will apply from the date of assessment of the Rateable Valuation of the property until the end of that year. Commercial rates will be charged from the start of the next year. The calculation/liability is similar to that of Commercial Rates.
The Local Government (Business Improvement Districts) Act 2006 is available on the Irish Statute Book website.