Valuation notices on shooting rights have been reignited and are currently being sent out to all Scottish landowners with sporting rights potential. To ease our member’s worries the Countryside Alliance has produced a Frequently Asked Questions report.
What are sporting rates?
Sporting rates are a form of business rate charged on deer stalking and game shooting such as grouse moors. Rates for these businesses were introduced in the mid19th century when land owners started to lease sport commercially, and therefore became liable for local government rates.
When were shootings last entered in the valuation roll?
Shooting rights and deer forests were in the valuation roll up to 31st March 1995. They were then excluded by section 151 of the Local Government etc. (Scotland) Act 1994, as it became too costly to recover the cumbersome and inflexible tax.
Why are they being entered in the valuation roll again?
The Land Reform (Scotland) Act 2016, one of the more controversial pieces of legislation passed by the Scottish Parliament, came into force on 22 April 2016. Part 6 of the Act repeals the exclusion of shootings and deer forests from the Ratings Valuation Roll. The Scottish government hopes to return an estimated £4million a year from the shooting rights tax, which will then be used to boost the Scottish Land Fund, a programme which supports community organisations across Scotland to own land, buildings and other assets.
How are shooting rights defined?
The right to shoot is normally associated with ownership of land. Essentially, if you own the land you own the right to shoot. However, the right to shoot may be transferred to another person by lease or by licence or alternatively may be retained by the owner when land is sold or by the landlord when land is let – e.g. for agricultural use.
How are shooting rights valued?
The area over which shootings may be exercised is the unit of measurement, usually stated in Hectares (Ha). A rate per Ha is applied to this dependent on the land type. Land types and rates are as below.
The rates are to be applied relative to the predominant land type over which the rights are exercised. If the nature of the land is of relatively equal proportions of particular land types, often considered to provide the best shooting potential, then the “Mixed” rates should be applied. It is likely that most lowland shoots will be classified as “mixed” and therefore be charged £5/Hectare.
Who is being targeted?
All land holdings with a sporting potential are being targeted, irrespective of whether or not that right is exercised and the land is used for sporting activities. It is up to the landowner to appeal if the shooting rights are not used or the valuation is incorrect.
What happens if there are two sporting tenancies over a single landholding?
We have heard of examples that if one party holds the deer stalking rights whilst another holds the general shooting rights then there would be two separate entries made in the valuation roll.
Are there any allowances applied in the valuation?
The majority of landholdings will benefit from the Small Business Bonus Scheme that offers relief to properties with a rateable value of less than £15,000. However, and importantly, this new tax along with other business interests (holiday lets, diversification businesses) may push businesses over the threshold to a level where rates become payable.
A quantum allowance has been applied for very large areas. There may be instances where a further allowance is appropriate. Any allowance, other than quantum, will usually be a maximum of 10%.
Further information on reliefs can be found on the Scottish Assessors website.
Should I appeal?
The Assessors are expecting a number of appeals and have allotted a time frame of six months from the arrival of the Assessor’s note in which to lodge an appeal. If you feel the Rateable Value of your shooting rights is incorrect, even if it amounts to under the Small Business Bonus Scheme of £15,000, the advice is to appeal the note. With the Scottish Government determined to make this new tax succeed, future changes to the Small Business Bonus Scheme or rate per Hectare paid could occur. It is important that all shooting rights owners remain ahead of the curve.
All effort should be taken to evaluate the rateable value, to understand the information provided and investigate how the liability can be mitigated by the available reliefs and appeals process.
What else is included in the Valuation Roll?
The rates derived from the rental evidence do not reflect the inclusion of any buildings. Accordingly, any buildings should be included separately in the valuation roll unless occupied together with a Deer Forest. When considering entering any larder or store the location will determine whether it is appropriate to do so, e.g. is it within the localised area of the operation. It might be that the store is too far from the deer management area to be considered connected or that the building is connected with another purpose and therefore rated separately.
Larders/Chillers. These may be purpose built, contained within older buildings and converted to use as a game larder, or refrigerated containers. Local evidence should be used to derive the appropriate level of value. Reference to SAA Industrial Properties Committee Practice Note 2, Valuation of Cold Stores, may be required to enable valuation of game larders. Information found here www.saa.gov.uk/blog/document-search/cold-stores/
What about land used for rearing?
A valuation roll entry should be made for any rearing pens and the land on which they are situated. Reference should be made to the Cost Guide to determine appropriate unit cost rates to be applied to the rearing pens. Local evidence should be used to determine the level of value to be applied to the ground.
Where there are demountable rearing pens, and the land is otherwise used for an agricultural purpose when the pens are removed, consideration of agricultural exemption may be required.
Sole use for a substantial part of the year and degree of permanence will assist in reaching a conclusion on this matter. For example, if the land is used for animal grazing from September through May it could be considered as agricultural use.
Other Buildings; stores, garages, kennels, lunch accommodation, lodges and bothies. It is likely that local evidence will enable the valuation of the majority of these buildings. Reference should be made to relevant SAA practice notes for those buildings which may not be valued by reference to local evidence.
Any further Questions?
If you have any further questions please contact the Countryside Alliance, your local Assessor’s Office, or your land agent.