[2025] UKUT 00291 (LC)

The statutory basis of valuation for rating is found in paragraph 2(1) of Schedule 6 to the Local Government Finance Act 1988. A rateable value is an amount equal to the rent at which it is estimated the hereditament might reasonably be expected to let from year to year on the antecedent valuation date, or AVD which in this case is 1 April 2021.

It is assumed that the property is in a state of reasonable repair immediately prior to being let and that the tenant undertakes to pay all the usual tenant's rates and taxes and to bear the cost of the repairs, insurance and other expenses necessary to maintain the property in a state to command that rent. By paragraph 2(6) and (7)(a) of Schedule 6 matters affecting “the physical state or physical enjoyment of the hereditament” are taken to be as they were on the “material day”, which is the date on which the 2023 rating list came into effect or the date, if later, when the hereditament was entered into the rating list. In this particular case the material day is 1 April 2023.

In practical terms this means that the rateable value of the Property is the 1 April 2021 rental value on a defined set of terms but with the physical state of the Property assumed to be as it was on 1 April 2023.