Debt collectors called in to claw back Business Rate arrears

By Stuart Hicks. Director.

English and Welsh councils are believed to have used bailiffs on nearly 41,000 firms that struggled to pay higher business rates following the Government’s controversial revaluation last year.

Apparently, research shows that tens of thousands of businesses that failed to pay higher business rates were subsequently referred to bailiffs that were given power to enter premises, seize goods and sell them at public auction in order to settle their debts.

If that figure wasn’t shocking enough, it only accounts for the first five months after the April revaluation kicked in.

Freedom of Information requests were used to gather the data for the 1.37 million business premises in 247 local authorities in England and Wales – a pretty big undertaking.

Once collated, the stats showed that 28,355 premises liable for business rates were referred to bailiff enforcement over that period. Using that information researchers then made estimates to account for the 1.98 million liable business properties for the total 348 billing councils in England and Wales, bringing the total number of firms referred to bailiffs over the period to 40,965.

Two London boroughs – Hounslow and Lewisham – had the highest referrals, with one in 11 premises assigned bailiffs. Not surprisingly, these two boroughs saw RVs jump by 25.09% and 31.83%, respectively.

It seems the pain of the Revaluation has had an immediate and painful impact for some regions, but this won’t be uniform across the country, many businesses which suffered because of the delay in the Revaluation are now enjoying the discounts they were due back in 2015. There are always winners and losers when it comes to business rates, but it seems anyone with shares in debt collecting firms at the moment will enjoy a stellar year.