Appealing Fast Food Take-Away Business Rates

gunner786

Hi,

I have a fast food take away with a rateable value of 11666..
Have appealed and they have offered me a reduction to £6100.
But i heard that for a fast food takeaway they should only measure the part in front of the counter as everything behind the counter shouldn't be included.

Can anyone help me out on this i have tried searching on google/yahoo cannot find any sort of information.

1 Ground Retail Zone A 26.60 £300.00 £7,980 2 Ground Retail Zone B 22.80 £150.00 £3,420 3 Ground Staff Toilets N/A £0.00 £0 4 Ground Internal Storage 3.00 £30.00 £90 5 Ground External Storage 11.70 £15.00 £176 Total area: 64.10 Subtotal: £11,666 Total before adjustments: £11,666
Basically my issue is that shouldn't takeaways only have a Zone A? Because the rest is just kitchen cos behind the counter i have my fryers and doner machine.

any help would be appreciated, i only appealed because i had some hammersmith properties guy come around guaranteeing me to have it moved down to £5000odd and told me that the only thing that should be measured is the front of my counter which is barely 20 m2/unit.

Now the guy dealing with my appeal at the voa is disputing the fact that take aways should be measured only from the counter to the front.

lincroft1710

The whole area of a property (whatever the usage) is measured for business rates. There are no exceptions for fast food takeaways. Zoning is done from the front of the shop to the first load bearing wall.

http://www.voa.gov.uk/corporate/Publications/Manuals/RatingManual/RatingManualVolume5/sect920/b-rat-man-vol5-s920.html#TopOfPage

I'm ex VOA by the way.

BusinessRatesExpert

You musn't forget that the rateable value of your property is intended to reflect the rental value.

I would suspect that your rent is much more than £6100 and the VO's approach of valuing hot food takeaways on the Zoning basis nearly always means that the RV is too low. So be careful on pushing it further.

As far as some chap telling you to measure up to the counter, that sounds like cowboy salesman speak to me.

On the plus side if they are going to reduce your RV to £6100, this will give you substantial small business rate relief, assuming this is your only shop.

Relief is 100% up to October 2012 for rateable values of £6000 or less and tapered thereafter. So you could be paying pennies in rates as a result.

If the rateable value is reduced it will likely be backdated and the SBRR can be backdated also which could mean a sizeable refund.

But you have to ask your Council for the form.

Should be on their website or you can search the net and find one.

coupleuk

Sorry to hijack this thread but the OP seems to have his Q covered.

I could do with some guidance on business rates for a hotel.

Ive been passed to 3 different VOA offices now and am awaiting a reply from (hopefully) the correct office.

Is there a set "no of bedrooms" calculation for working out rates on a hotel?

We currently have 15 en-suites (about to be 17) situated on 1st and 2nd floors and a bar/restaurant on ground floor.

We are thinking of closing the bar/restaurant and only trading the hotel. Would that have much affect on the rates?

Current RV is £27,500.

Thanks

Wywth

coupleuk wrote: »

Sorry to hijack this thread but the OP seems to have his Q covered.

I could do with some guidance on business rates for a hotel.

Ive been passed to 3 different VOA offices now and am awaiting a reply from (hopefully) the correct office.

Is there a set "no of bedrooms" calculation for working out rates on a hotel?

We currently have 15 en-suites (about to be 17) situated on 1st and 2nd floors and a bar/restaurant on ground floor.

We are thinking of closing the bar/restaurant and only trading the hotel. Would that have much affect on the rates?

Current RV is £27,500.

Thanks

I'm sorry I can't comment on what effect the closure of your bar/restaurant may have on the rateable value, but I would have thought it would have a significant negative impact on your turnover and profitability, not just by the loss of income from that facility but also on the negative impact it would have with quests who stay in the hotel rooms who would lose that on site facility.

You would need to retain the kitchen and dining facility anyway to provide breakfasts, so surely it makes sense to utilise those facilities and increase income at other times of the day?

coupleuk

I would have thought it would have a significant negative impact on your turnover and profitability, not just by the loss of income from that facility but also on the negative impact it would have with quests who stay in the hotel rooms who would lose that on site facility.

You would need to retain the kitchen and dining facility anyway to provide breakfasts, so surely it makes sense to utilise those facilities and increase income at other times of the day?

Im not even sure Im going to offer breakfasts yet (should have been more clear that this is business purchase) - thinking of reducing B&B rate from £85 down to £59/£65 as "room only".

There are 7 cafes within 2 minutes walk and probably 6 pubs which also do breakfast/meals. Then there are 3 indian restaurants, 2 chinese, italian etc etc.

Currently, the bar/restaurant is lucky to take £50/day during the winter and I have to question the logic of keeping it open - in terms of staffing, utilities, maintenance, rates etc.

Hopefully, by lowering the room rate, I will get more trade even though I may lose some of the clients who want the full works. I think that as long as Im clear what else is available nearby, guests will appreciate the £20+ rate saving and spend £10 locally on breakfast if they wish.

The bar/restaurant could then be converted into a further 8 en-suites.

IF I do go the room only route, I shall still provide the basic facilities (toasters/microwave/kettles/fridge/cutlery etc) in a communal room for guests use - they can also bring in takeaways and eat in there too.

Wywth

coupleuk wrote: »

Im not even sure Im going to offer breakfasts yet (should have been more clear that this is business purchase) - thinking of reducing B&B rate from £85 down to £59/£65 as "room only".

There are 7 cafes within 2 minutes walk and probably 6 pubs which also do breakfast/meals. Then there are 3 indian restaurants, 2 chinese, italian etc etc.

Currently, the bar/restaurant is lucky to take £50/day during the winter and I have to question the logic of keeping it open - in terms of staffing, utilities, maintenance, rates etc.

Hopefully, by lowering the room rate, I will get more trade even though I may lose some of the clients who want the full works. I think that as long as Im clear what else is available nearby, guests will appreciate the £20+ rate saving and spend £10 locally on breakfast if they wish.

The bar/restaurant could then be converted into a further 8 en-suites.

IF I do go the room only route, I shall still provide the basic facilities (toasters/microwave/kettles/fridge/cutlery etc) in a communal room for guests use - they can also bring in takeaways and eat in there too.

An on site restaurant and bar that is lucky to take £50 a day?
A 15 room hotel you say. What occupancy rates are achieved?
£50 converts to about one couple taking one of the 15 available hotel rooms at £85 per night customising the restaurant/bar.

There's clearly a demand by those who are paying £85 per night to be able to obtain food on site if you are suggesting they go and bring back a takeaway.
And despite there being nearby competitive food outlets, there is nothing like obtaining breakfast (and perhaps other meals) whilst still on site.
I think you are seriously mis-judging the current hotel trade if you think those who currently pay £85 per night are willing to make their own breakfast with your supplied toasters and microwaves - they will still presumably have to go out and buy this food in the first place.

Also have you done your sums?
Even at 100% occupancy (which no hotel achieves), the current rooms have the potential to attract 15x£85 per night = £1275

If you were to close the bar/restaurant, reduce the room rate to only £59 per night but convert the existing bar/restaurant to a further 8 rooms, this would only bring in a maximum income of (15+8)x£59=£1357 so only £82 more.

As I said this calculation is based on 100% room occupancy which you will not achieve.
And the removal of the possibilty of "&B" from the current "B&B" offering will only drive down occpancy levels, imo.

Time to re-evaluate your business plan before plunging into this business, I suggest

Wywth

Dont forget the results and comments of this earlier thread/poll you created last April (not sure why you deleted your posts therein:huh:)
https://forums.moneysavingexpert.com/discussion/3882249

Only 30% of those who voted opted for a room only option (which you could still offer as an option), but the other 70% said they preferred breakfast to be offered

ETA: Actually it's even less than that as it was a multiple choice poll - only 6 out of 31 votes cast opting for room only actually relates to <20%

coupleuk

An on site restaurant and bar that is lucky to take £50 a day?
A 15 room hotel you say. What occupancy rates are achieved?

55%

£50 converts to about one couple taking one of the 15 available hotel rooms at £85 per night customising the restaurant/bar.

It could also convert to nobody from the hotel customising the bar/restaurant which (during 5 months of the year) probably sees half a dozen locals stroll in there.

There's clearly a demand by those who are paying £85 per night to be able to obtain food on site if you are suggesting they go and bring back a takeaway.

Thats not what I said - I suggested that they "could" bring back a takeaway and use the communal dining area.

And despite there being nearby competitive food outlets, there is nothing like obtaining breakfast (and perhaps other meals) whilst still on site.

Of course some traditional guests would want that - but those guests tend not to visit out of season whereas business users do; and perhaps they dont have time for a lazy breakfast.

I think you are seriously mis-judging the current hotel trade if you think those who currently pay £85 per night are willing to make their own breakfast with your supplied toasters and microwaves - they will still presumably have to go out and buy this food in the first place.

They wouldnt be paying £85 - they'd be paying a room only rate and saving £26 and would have the CHOICE of whether to get food locally.

Also have you done your sums?
Even at 100% occupancy (which no hotel achieves), the current rooms have the potential to attract 15x£85 per night = £1275

If you were to close the bar/restaurant, reduce the room rate to only £59 per night but convert the existing bar/restaurant to a further 8 rooms, this would only bring in a maximum income of (15+8)x£59=£1357 so only £82 more.

And save £6.50 per hour for kitchen staff, waitress, bar staff - which is roughly £100/day. Then you save on utility bills, holiday pay, PRS licence, business rate reduction etc.

Thats a minimum £200 per day or £73,000 per year - less the as and when housekeeper costs to maintain the extra rooms

As I said this calculation is based on 100% room occupancy which you will not achieve.

When we are running at 10% occupancy during the winter, we would still have to pay the previously mentioned £200/day staffing costs etc JUST IN CASE someone wanted a beer or meal. If we have 2 rooms booked, we would still have to cook the breakfasts and still have to serve them at the time our customer decides to stroll in for breakfast.

And the removal of the possibilty of "&B" from the current "B&B" offering will only drive down occpancy levels, imo.

Time to re-evaluate your business plan before plunging into this business, I suggest

That's what Im here for - to listen to opinions - BUT (whilst you have made some valid points re loss of traditional guests), I believe in the present climate, the occupancy rate will improve overall.

However, Im still keen listen !!

Perhaps I should go down the route of offering breakfast as an optional extra - pleasing the trads whilst also providing a lower cost option for the business customer.

That would then allow me to offer "half-price" nights in the winter without having to cost-in the breakfast too as it can be sold as extra.

Comments in red above.

PS the previous post you refer to had to be removed due to a problem with another poster on here at that time.