Tuesday 14 May 2013

Do Sunderland businesses claim what they're entitled to?



I was wondering  how helpful Sunderland Council/Labour have been to small businesses in the local area, and I decided to put in a Freedom of Information request to see what the uptake of the government's Small Business Tax Relief scheme. The council isn't allowed to say who is claiming this, but strangely enough, they are allowed to say who isn't! Bureaucrats! Anyway, the results were very interesting. I asked:-

Q. The number of small businesses with a rateable value below £12,000 in the Sunderland area, which is the current threshold for Small Business Rate Relief.
A. There are 2792 properties in Sunderland with a rateable value below £12,000.

Q. The number (and percentage) of these businesses who are eligible for but not claiming Small Business Rate Relief.
A. 2075 (74.32%) of those properties referred to in (a) are not currently claiming Small Business Rate Relief.

Q.  How does the council inform businesses whether they are eligible for this, if indeed they do so?
A.  We actively promote Small Business Rates Relief, information is included with bills and is explained fully on the council’s website. We also send out application forms and inform businesses during all contact with them that they could be eligible.
 
So in other words, three quarters of all businesses are entitled to claim money back from the council, but don't! Outrageous! You'd expect our esteemed councillors to shout about this to the rooftops, wouldn't you. It would make them look good. But then, it would also impact on the amount of money that the council claws into its' coffers. It's a simple enough choice. Give businesses money to help them, or keep it for things like  those high salaries. It was in the news last week that the chief executive and 11 of his executives were paid £1,662,768 last year! £229,547 of that was for the chief executive himself!

You can see the full list at:-
Some interesting things emerged. As well as the many business addresses listed, there were several other types of business facility on the FOI list, which must obviously be eligible for making claims. Some examples are:-

(i) Advertising hoardings - I suppose there's a rental cost for these which is claimable.

(ii­­) Telecommunications masts and receivers - I know these pay land rent. Obviously another tax loophole.

(iii) Rented office facilities

(iv) Car parks. Quite puzzling that the council list has its own carparks on, e.g. Raby Road Carpark, Washington (item 1726). Also a few schools, and recreation grounds. Is the council saying it can claim back tax on its own property so it doesn't have to pay itself? One of those internal markets or limited companies? Or did they just copy and paste the info from another document?

(v) There are a number of charities, sporting and volunteer organisations on the list. Is the council saying these are liable for tax relief, but it's not telling them? Very charitable. 

All I can say is, it raises a lot of questions (and hackles) even in somebody like me with a very basic knowledge of tax. It really needs the research skills/advice of a tax expert or accountant.

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