What happens if I do not pay?
If you have problems paying your business rates it is important that you contact us as soon as possible to see how we can help you. The following information details the recovery actions that are taken with regards to non payment of business rates.
- Bills & reminders
- The summons & liability order
- Enforcement agents
- Individual or company voluntary arrangement
- Committal proceedings
A bill is sent in March for the annual charge (1st April - 31st March) which is payable by ten-monthly instalments. If you miss a payment we will take action to recover the money.
We will send a reminder notice for any unpaid instalment shortly after it is due. The overdue amount must be paid within seven days. Note that if you move in during the year, a bill will be sent for part of the year and is payable by monthly instalments.
If the overdue amount is not paid within seven days, after a further seven days you will lose the right to pay by instalments. No further reminders will be sent and if the full balance remains outstanding you will be sent a summons advising you that we will be applying to the court for a liability order. The summons includes costs that you will need to pay in addition to the charges that are due.
If you bring your account up to date within seven days of the reminder you can still pay by monthly instalments as shown on your bill, but only one reminder notice will be sent in the year. Therefore, if you fall behind again you will lose the right to pay by instalments and the outstanding year's charge will become due within seven days. If the overdue amount is not paid a summons will be issued.
If you are sent a summons you will also have to pay summons' costs. This is the amount the court has agreed we can charge you for the time and cost it takes to produce and issue the summons.
We will give you at least fourteen days' notice of the court hearing date. We will take no further action if the outstanding charge and costs are paid before the hearing. At the hearing the council will apply for a liability order, this enables the council to recover the outstanding balance by the methods detailed below. The liability order also includes costs that you will need to pay in addition to the charges that are due.
You do not have to go to the court if you accept the business rate charge is correct. You can go to court if you do not agree the charge is payable.
If the full amount remains unpaid after the liability order is granted, we will ask a bailiff firm to collect the charge for us without any further notice. From this stage you will need to discuss any payment issues directly with the enforcement agent instead of us, but the enforcement agent will work within a code of conduct we have agreed with them.
You will have to pay more costs if the enforcement agents are used to collect overdue rates.
The enforcement agent will try to make an arrangement with you to pay the charge outstanding, but if this cannot be done, or you do not pay as agreed, the enforcement agent can remove goods from your business to sell at auction to raise the funds to pay the charge. If enforcement action is unsuccessful there are further options available to us.
If the business is in the name of individuals rather than a limited/incorporated company, and you owe more than £5,000.00, we can start bankruptcy proceedings against you under the Insolvency Act. Your home could be sold if we have to take this action.
If you have been declared bankrupt already you will need to send us documentary evidence to confirm the date of the bankruptcy order. The Official Receiver will appoint a Trustee who will send us a proof of debt form so we can make a claim for the amount you owe. Once any assets you possess have been identified and evaluated, the Official Receiver will arrange to send payment to us as one of your creditors.
The Official Receiver will include any debts incurred before your bankruptcy, however if you still occupy the property you need to continue to pay any business rates that are due. If the property is empty and unoccupied and has become the responsibility of the Trustee, no business rates will be payable as the property is exempt from empty rates.
If your business is a company and you owe more than £5,000.00, we can start liquidation proceedings against you under the Insolvency Act. If your company has gone into liquidation already, you will need to send us documentary evidence of when it happened.
If there are any business rates outstanding up to the date of liquidation, we will make a claim as an unsecured creditor to the Insolvency Practitioner appointed to deal with your company. Dependent on the other creditors and the assets of the company, we may receive a payment (dividend) to help reduce what you owe.
Debts incurred before the company was liquidated will be included in our claim to the Insolvency Practitioner. If the property is empty and unoccupied and has become the responsibility of the Insolvency Practitioner, no business rates will be payable as the property is classed as exempt from empty rates.
If your business is a company we can apply to the court with other creditors for you to be placed in administration.
If your business has gone into administration already, you will need to send us documentary evidence of when it happened. If there are any business rates outstanding up to the date of administration, we will make a claim to the Administrator. Depending on the circumstances, we will not take any further recovery action while the Administration Order is in place. We will ask the Administrator to pay any business rates due from the date of the Administration Order.
The administrator will look at your company's finances and decide if, by letting the company continue to trade, its financial situation may improve, or it may be decided to sell the business as a going concern. Alternatively, the administrator may recommend the only courses of action are liquidation, or a Company Voluntary Arrangement.
If as an individual or as a company you approach an Insolvency Practitioner to make a voluntary arrangement, you will need to send us documentary evidence of when the arrangement took effect. If there are any business rates outstanding up to the date of the arrangement, we will notify these to the Insolvency Practitioner.
The Insolvency Practitioner will write to your creditors to arrange a meeting where your debts will be confirmed, and the creditors will decide whether to accept a payment arrangement. If the arrangement is accepted we will receive payment from the Insolvency Practitioner of an agreed amount. If the arrangement is not accepted then recovery action will continue.
If you still occupy the property you need to continue to pay any business rates that are due from the date of the voluntary arrangement. If the property is empty and unoccupied and you are still in possession of the lease or freehold, empty rates will be payable after a three-month exempt period (or six if an industrial property), unless an exemption to unoccupied rate applies.
If your company is placed in administrative receivership you will need to send us documentary evidence of when it happened. If there are any business rates outstanding up to the date of receivership, we will notify the receiver appointed to deal with your company.
Dependent on the other creditors and the assets of the company, we may receive a payment (dividend) to help reduce what you owe. If the company is still trading we will ask the receiver to pay any business rates due from the date of the Receivership.
If you are a sole trader rather than a company and all other recovery methods have been unsuccessful we can apply to the Magistrates' Court for your committal to prison for non-payment of business rates. We would prefer not to take this course of action but if all other methods have failed and you have not contacted us to make an arrangement we will be left with little choice.
Things to read
Things to do
- Pay your business rates online
- Go to the business rates section at www.gov.uk
- Visit the Valuation Office Agency website
- Visit the Royal Institution of Chartered Surveyors website (RICS)
- Visit the Institute of Revenues Rating and Valuation website (IRRV)
- Contact us about business rates
- Application for small business rate relief