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17 February 2020 | Comment | Article by Roman Kubiak TEP

Is the charitable business rates relief for schools and hospitals in Wales about to change?


On 31 January 2020, the Welsh Government issued a consultation on the eligibility of schools and hospitals in Wales for charitable rates relief. This consultation follows the introduction into the Scottish Parliament of a Bill that includes a provision to remove charitable relief for mainstream independent schools.

Find more information on our Charities team, or if you want to discuss any issues raised in this article contact us today.

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At the moment, mandatory relief from business rates is available for occupied premises where the ratepayer is a charity, or the trustees for a charity, and the premises are wholly or mainly used for charitable purposes (whether of that charity or of that and other charities). The relief provides over £60 million of support in Wales, reducing bills by 80% for eligible ratepayers. Local authorities have power to provide discretionary relief to top up the remaining 20%, in whole or part. Charitable rates relief is the largest relief claimed by charities.

To put this in context, there are approximately 120,000 non-domestic properties in Wales, contributing around £1 billion in revenue each year.

The consultation is seeking views on:

  • Whether or not the following bodies should be eligible for charitable relief:
    • Independent and private schools;
    • Maintained and public sector schools; and
    • Private and public hospitals;

by contributing to the cost of local services by paying rates on the properties they occupy, as other service providers do.

  • The potential effects of making any changes to the level of charitable relief provided.
  • Any exemptions, if the Welsh Government were to change current eligibility for charitable relief.

The consultation document says that there is “no indication of intentions” to change eligibility for charitable rates relief in England or Northern Ireland.

No doubt though, charitable independent and private schools, as well as private hospitals throughout the UK will follow these developments with some anxiety.

The Welsh consultation closes on 24 April 2020: there is still plenty of time for those likely to be impacted to voice their views.

Find more information on our Charities team, or if you want to discuss any issues raised in this article contact us today.

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Author bio

Roman Kubiak is a partner and head of the market leading Contested Wills, Trusts and Estates team. He advises across the whole spectrum of private wealth disputes, with a particular focus on high value, complex and cross-border disputes including: trust disputes, breach of trust claims and applications to remove trustees; will disputes, particularly those with an international element; claims under the Inheritance (Provision for Family and Dependants) Act 1975; and claims for equitable relief under proprietary estoppel, constructive trusts and resulting trusts.
Roman Kubiak TEP

Roman Kubiak TEP

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Disclaimer: The information on the Hugh James website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. If you would like to ensure the commentary reflects current legislation, case law or best practice, please contact the blog author.

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