Bailiffs visited more than 200 firms daily over unpaid business rates

In the first year after the new business rates revaluation came into effect, councils sent bailiffs to more than 200 commercial properties everyday for unpaid rates.

An investigation by real estate advisor Altus Group revealed that during 2017/18, over 81,000 business premises liable for rates were referred to bailiffs to levy distress and to seize their goods for non payment of rates.

Under the Freedom of Information Act, all councils in England were asked to provide details of how many business premises had been referred to bailiffs – now known as enforcement officers – between 1 April 2017 and 31 March 2018. Some 264 English councils provided details on 1,583,640 out of the 1,902,148 properties liable for rates.

The responses, which cover 83 percent of all properties, showed a total of 67,705 instructions to bailiffs were made, equating to 4.3 percent of all premises. Altus Group has predicted that including the businesses which information was not provided for, the overall number of businesses visited by bailiffs was 81,317. This is equivalent to 222 businesses per day.

From last year, businesses with only one property liable to business rates were exempt if the rateable value was £12,000 or less up from £6,000. Analysis of official government data by Altus Group show that as a result of the changes to small business rates relief, 655,970 out of the 1,902,148 premises were completely exempt from rates and did not receive a bill.

Leaving 1,246,178 business premises with actual rates demands, the findings reveal 6.53 percent of firms, almost one in every 15 commercial property with a bill, faced having their goods seized by bailiffs. This was up from 5.96 percent the year before.

Birmingham City Council referred 3,864 premises to bailiffs which was the most of any English council although the number of instructions were down from 4,414 in 2016/17.

Manchester City Council referred 2,667 business premises to bailiffs the second highest number of instructions up 38 percent from 1,932 in 2016/17.

The government plans to increase the share of business rates English councils retain from 50 percent to 75 percent in 2020, and is currently piloting 100 percent retention in certain parts of the country such as Birmingham and Manchester. Liverpool, Coventry, Hounslow and Brent councils all made over 1,000 referrals to bailiffs.

Robert Hayton, head of UK business rates at Altus Group, said: “Councils are taking enforcement action much earlier since their finances became more aligned to business rates income. This sometimes leads to companies with manifestly incorrect demands receiving summonses and facing enforcement action.