CIC Association

Serving Community Enterprise

As a Trustee for the Light of Hope CIC ( I would like to ask if any other CIC has been given rate relief from their local council? We have just been refused both mandatory and discretionary relief from Trafford council, and yet our premises in Hebden Bridge has always received 100% rate relief from Calderdale.

Has anyone any advice/strategies for overcoming this problem please? All help gratefully received!

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Comment by John Mulkerrin on June 19, 2016 at 13:12

Hi Iain

The outcome of the 2015 review is the issue is very complex and challenging, and the experiences of CICs individually can be night and day. Some CICs are being treated very harshly, some are not even being given a fair hearing and some are being pushed to the heart of the LA strategy to improve community engagement and participation.

Being totally honest we dont quite know how to tackle it at the mo, I dont think we can try and ask for all CICs to be given rate relief as Charities currently receive but I know that is perhaps the most populist idea and what members would probably like to achieve,knowing the detail I suggest that will never happen.

What I think the absolute best result we can actually achieve is for CIC Limited by Guarantee to be considered the same as Charity for discretionary business rate relief. Most Charities are Limited by Guarantee as are the majority of CICs (approx 75%)

I dont think any CIC that can distribute profits to shareholders (schedule 3 Share CICs) could reasonably expect to receive it automatically, as that would be deemed unfair to normal small companies.

That is something we can try to get centrally, but the truth on the ground is that over the last few years there have been growing calls for the automatic Charity rate relief to be withdrawn, so tough to see how we would even be considered for that in that environment.

To get a positive decision on any macro decision would be a fantastic result, but we'll have to get strong participation to make any real progress. Its the reason we asked the question about rates on the survey. We have a huge amount of info now to take forward and again I plan to start a new effort at the next CIC Regulator Technical Panel.

Let us see how that progresses, as short term goals I will propose we need:

1.  A document for all CICs to show best practice, tips and guidance on the full process and how to maximise chances.

2. A document for all LAs providing case studies of CICs and positive outcomes for LAs providing relief to CICs. It is also important that CICs and LAs understand how to express the social outcomes of what they achieve, to help the LAs make positive decisions. I believe lots would be more confident with such a document showing they are duty bound not to consider the application on financial considerations only, which is the actual fact of the matter.

How do you proceed? Have you appealed? Have your LA provided relief to a CIC yet? Happy to help if i can

Comment by Iain Drew-Taylor on June 17, 2016 at 19:09

So, many of the post here are historical...). can anyone update me on the present situation. what was the outcome of the business rates review of 2015. Have your various trials and tribulations been fruitful with the local authority or are we just being marginalised as CIC's because we fall into the 'too hard to do' box for some local official?

We are a local CIC based in Macclesfield, we are not a registered charity ( as far as I know, you can't be both CIC and charity) and therefore the Local authority will not waive the Business rate of £1000 a month on a premises we are interested in occupying, which has stood empty on the high street for 2 years. Our articles make us just as valid as any registered charity, community based, and not for profit.helping the vulneable and needy.  We are not turning over 174 Million like Age concern, or others like YMCA who could probably afford to pay. we can't afford the grand a month they are asking, we wouldn't be able to run the project; so how do we proceed?. This part of the business  plan was designed to generate revenue for other areas of the CIC to make us less dependent on grant funding, we are also allegedly being supported by the local council to run it!

We know the model being utilised works, as we have visited two other furniture reuse projects, one of whom we now collaborate with to provide emergency furniture packages to the needy.  they have been running 10 years, but don't provide the same range of services that we do, and operate on the other side of the county to avoid conflict of interest.

Do we just keep bashing away at the local council until they see sense?...thoughts anyone.

Comment by John Thirsk on March 15, 2015 at 14:18

Still battling, have we charitable status as we are a not for profit social enterprise, working in a very basic facility, no water just a roof over a large enclosed area. But now faced with a business Rate bill of £4000 at the final demand stage. Help

Comment by Ciaran Rose on September 3, 2013 at 17:02

Further details after speaking withJohn down below who gave us some very helpful advice. After speaking again to SDC (sevenoaks district council), they were polite and just realed off the information. No discussion it set in concrete. Currently it is with my councillor but I don't hold out much hope. We have made a decision to close down the work being done in the studio as the Council has absolutely no interest in what we are doing for the local community at all.

An Interessting point is that the RV of our studio is greater than the rent I pay. Sounds silly to me.

An interesting point in this is just today we have discussed with a disabled charity to run workshops for terminally ill children in puppetry. We are currently looking to re house the existing classes that run in our studio. and we will go back to being mobile.

However we do need an office so we are looking for a bit of desk space so we can have face to face attendance if people want it.

It never fails to amaze me how councils fail in the most fundamental point of respect - at least listen to those people who you are meant to be looking after. SDC does not discuss. this is it no deviation no discussion no amendment at all.

In some respects it has put our business back in others in may have given us alternative opportunities. Which it is remains to be seen.

Comment by John Mulkerrin on September 3, 2013 at 13:05

To simplify this for those CICs with one site and rateable value of £6k or less - you can get 100% relief  from 1st Oct 2010 to March 2014. (In the example below it states March 2013, but Govt have extended it for another year)

Comment by John Mulkerrin on September 3, 2013 at 13:01

You will be eligible for small business rate relief in England if your rateable value is below £18,000 (£25,500 in London):

  • If your 2010 rateable value is £6,000 or below, the small business rate multiplier is used and the bill will be reduced by 50 per cent.
  • If your 2010 rateable value is between £6,001 and £11,999 inclusive, the small business rate multiplier is used and the bill will be reduced on a sliding scale – from 50 per cent at the bottom of the range to 0 per cent at the top.  For example, if the rateable value is £9,000, the bill will be reduced by 25 per cent.
  • If your 2010 rateable value is between £12,000 and £17,999 (£25,499 in London), the small business rate multiplier is used only.

Between 1 October 2010 and 31 March 2013, eligible ratepayers will receive small business rate relief at 100 per cent on properties up to £6,000 (rather than 50 per cent), and a tapering relief from 100 per cent to 0 per cent for properties up to £12,000 in rateable value for that period.

The temporary Small Business Rate Relief increase will therefore apply throughout the whole of the 2012-13 billing year (until 31 March 2013).  The relief was originally doubled by the government until September 2011, but this was extended by the Budget in March 2011, and then extended again in the 2011 Autumn Statement to take account of economic conditions.

If you have more than one business property, the relief is only available if the rateable value of each of the other properties is below £2,600.  If this is the case, the rateable values of all the properties will be combined and the relief is applied to the main property based on the total rateable value. 

You can also qualify via the discretionary business rate scheme. This isnt up to the LA officers to decide, if your figures fit you get the relief.

Comment by Ciaran Rose on September 2, 2013 at 14:24

I spoke with a helpful gentleman in this association about my local council and there management of there local business rates. You'll love this story.

In April this year (we launched at the same time) the standard rates request for the business rates. However it came with no form business rates form. So i rung up and they said they would send one. nothing came in. i asked 5 times for a form by now it is July and a friend had to try and get the form which low and behold he did. Filled in the form and before sending it off recieved a letter sating i owed the full rate.

I was told I probably was not eligible for the 50 % rate and most definitely not eligible rate for any discretionary rates. I would have to pay the full rate I know i am at least eligible for the 50% small business rate relief. I know I am eligible for it as I have had it checked. Anyway I got a letter saying I owed the full council rates on this and pay up. The business rates department said don't worry while we are checking the form to ascertain what the exact rate you are entitled to  - any further action will not be taken.

So I send the form and when I come back from holiday I find a court summons for the full amount of Business rates. When I ring them they say that A person came round the other day and we were shut - they assumed there was no business there. I pointed out that we run active fitness classes among other things and we were shut during August.

Well we are not interested in that says the council - but we can get a person round next weeks but you are still due the full council rates. I point out that what the councils claims is not actually correct due to the fact they have not finished there checks and balances on what I am eligible for and that It was not my fault they continually failed in supplying a form to fill in.I have subsequently attempted to to apply for a higher discretionary rate. I have contacted my Councillor but I don't expect the council to back down from my CIC having to pay the absolute maximum Business rates. I find it incredible that my council Sevenoaks can act in this blaise way with total discrgard for what we are trying to do and the benefit we bring to the local community.

The upshot will probably be that we close the CIC or move it elsewhere. If you are interested in seeing what our CIC does you can check our website.

Comment by Dawn Birch-James on July 19, 2012 at 15:11

I've only just joined the forum and am a novice in the ways of CICs. But I think this is a case of whoever happens to be on a cabinet at any said time and whether they link into what you are doing and where they see their priorities. This is a very difficult situation because it's the difference between making a CIC work or not in many cases

I'm just setting up a CIC and am due to go into a council run shop unit. I have yet to apply for discretionary rates relief but I am confident that the cabinet will be supportive. I sounded them out before I started to set it up. It just so happens that our council is showing more interest in the role of arts and culture to regenerate the city centre. I would be interested in keeping in touch on this issue as I shall be applying soon and no one can ever really predict outcomes. I hope you resolve this issue. My only advice is to link up with the councillor who is also in the cabinet who is also interested in the nature of your CIC which is what I did. I wish I could help more and was more of an expert on such matters

Comment by Alison Sargent on July 26, 2010 at 12:38
Many thanks for all your comments and suggestions. We have actually just received confirmation this week that Light of Hope CIC has now been granted full 100% rate relief from Trafford MBC after a long drawn out appeal process. A specific councillor has also been designated to attend to such issues in the future, so hopefully others will also benefit from our appeal. Many thanks Trafford!

We certainly have learned a lot through the process and would be happy to share our experiences/ideas with other CICs should you have a similar issue. Please contact us at The Hope Centre Manchester on 0161 973 9130 or e-mail: marked for the attention of John Astbury.
Comment by Jayne Bellis on July 25, 2010 at 17:28
I have found as a CIC we are a bit of a hybrid animal - some see us clearly as third sector, others won't have us through the door unless we have a full board of trustees and charitable status! For example we have been accepted as tenants in the local VC building in Flintshire North Wales - but in Cheshire (just across the border) we are 'barred' from being members - because of our set up!
Ah well! If I had my entrepreunial hat on I would say that is a good thing - because we can be 'whatever' we want to be (or basically it's down to how good you are at arguing!)


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