The case related to four warehouse properties entered into the 2005 rating list following their practical completion but before occupation or fitting out, and was a lead case for 60 similar disputes over whether new-build property can be assessed for rates purposes if it is not yet ready for occupation. Its immediate impact is that as much as £20m of liability paid by rate payers has been charged in error, but the long-term implications are far greater.
The Aviva appeal related to a warehouse at Reading Approach in Berkshire, and PPG’s appeal focused on a building at Torc:MK industrial park, Milton Keynes.
The VOA is not allowed to enter a new-build property into the rating list and assess its rateable value until it is deemed legally ready for occupation. The one exception is if the local authority issues a completion notice confirming the premises will be completed within three months.
The VOA argued that a completion notice was unnecessary.
The tribunal has now held that certain key features essential to occupation for the purposes for which the properties were designed to be occupied must exist before those properties can be entered in the rating list and rates demanded.
The decision has been seen as crucial because if the VOA had succeeded it would have been able to justify that the majority of new vacant industrial properties were complete for rating purposes.