Business Rates at Caravan Parks

Referring back to our previous article, an annual rates bill set by a local authority for a caravan park would be divided by the number of caravans on the park, according to a general principle of equity.  However, as we pointed out at the time, “There is no legislation covering this area, which means ultimately it will be your contract that governs this charge and how it is apportioned”.

As an information service to our members, NACO approached the customer service team at Valuation Office Agency (VOA) headquarters, to elicit some helpful feedback for holiday caravan owners.  We learned that a full explanation of the basis for rating leisure caravan parks is featured within the VOA’s website, by way of the Rating Manual, Volume 5, Section 185, available via: www.voa.gov.uk (publications section).  The focus here is on leisure caravan parks which contain some caravans owned by the site operator and others (probably the majority) which are privately owned. 

The key legislation is the Non-Domestic Rating (Caravan Sites) Regulations 1990 (S I 1990 No. 673).  It’s a dry and stodgy read – but  it’s there if you need it!  The bottom line is that the local authority bills your park for business rates every and the park then passes on the appropriate charge, via apportionment, to each caravan or lodge owner.

Diane Curtis, a senior advisor at the VOA, advises us that, “Any person who occupies a pitch for a leisure caravan on such a site may see a copy of the Statement which the Valuation Officer sent to the site operator.  No payment is necessary, but reasonable notice must be given to the relevant local (valuation) office”. 

Armed with a Regulation 4 Notice, it is possible to get a feel for what a fair proportion of the rates bill might be for your pitch.

Before the rates bill for the individual caravans at a park can be determined, the RV is subject to the prevailing “multiplier” which varies with external economic factors. This is often referred to as the “pence-in-the-pound” figure and is currently in the region of 48p

Now let’s look at a worked example, supposing a park with 200 privately owned caravans:

• The park operator has received a ‘Reg. 4 Notice’ and local authority NNDR billing
• The data cites a total RV of £180,000
• It also states that £90,000 of this is attributable to caravans at the park
• Multiplying by 48p gives caravanners’ total liability of £43,200
• To calculate the rate liability of the private caravans:
  £43,200 / 200 = £216.00 due in respect of each caravan for the year

You are entitled to view the Regulation 4 Notice, which should be available for inspection at your park. If your individual rates bill varies significantly from the figure you expect to pay, having substituted relevant figures in the above calculation method, it could be that your park operator is doing one (or some) of the following things:

• Using the total RV for the park and apportioning this to caravans
• Charging a fee for collecting the payments
• Including other items in the rates bill (eg water supply)
• Using a method of apportionment other than a straight division by number of caravans (eg twin units making a greater contribution)

As you can see, the waters can get pretty muddy!

We have aimed to give you a starting point to investigate your rates bill. However, as noted above, many factors come into play. If you need any further assistance – please give us a call.