Rating adviser Altus Group reports a consistent rise in the rateable values of beach huts across England and questions the use of Small Business Rate Relief to subsidise owners
LONDON (27 August, 2017) – A national rise in rateable values has hit around 89% of England’s beach huts, reflecting rising rents.
Although Small Business Rate Relief applies to properties or portfolios with rateable values up to £12,000, beach hut owners might still have to pay business rates if they own more than one hut or pay business rates on other properties.
Beach huts in Swanage (Dorset), Sidmouth (Devon), Southsea (Hampshire), Fleetwood (Lancashire), Seaton (Devon), Wells-Next-The–Sea (Norfolk), Weston-Super-Mare (Somerset) and Hayling Island (Hampshire) have all seen increases in their rateable values of over 300% with the 2017 revaluation. The highest rises of 678% are applied to huts at Ulwell Beach in Swanage.
Some beach huts on the Isle of Wight, on the other hand, have seen falling rateable values, as have those at Frinton On Sea (Essex), Shoreham By Sea (West Sussex), St Leonards By Sea (East Sussex), Southwold (Suffok) and Lancing (West Sussex).
Annual rises in business rate bills are capped, with the result that the maximum increase for a small property, such as a beach hut, would be 64% over 5 years.
Altus Group executive vice president, Robert Hayton, comments, “Long waiting lists for beach huts mean that sale prices can be high – reportedly as much as £275,000 for a cabin in Mudeford, Dorset, this year. At the same time, local authorities are looking for increased incomes and are charging higher rents for the cabins they own. That’s the price of preserving your modesty, having a shelter from the English rain or just brewing yourself a cup of tea when you want one. The result is that what looks like a cramped and draughty little house can attract a business rate bill larger than a Band A Council Tax bill.”
Hayton questions the use of Small Business Rate Relief for beach huts: “A beach hut is unquestionably a luxury purchase. Anyone who can afford the sale price of one of these, whether for their own use or as an investment, can afford to contribute to the costs of local services. Government subsidies, designed to support small businesses, can be better targeted.”