Issue - meetings

Purpose of Report

To inform the Executive of the estimated balance for the Business Rates element of the Collection Fund and the surplus or deficit to be declared for 2024/25.

Decision

That the action of the Chief Finance Officer in declaring a business rates deficit of £1,560,563 for 2024/25 be confirmed, subject to the confirmation of the business rates base by 31 January 2025, with any amendments to the declared deficit to be notified to the relevant preceptors and be included in the Final Medium Term Financial Strategy 2025-30, to be presented to Executive 24 February 2025.

Alternative Options Considered and Rejected

None. The Council was required to declare any surplus or deficit during January of each financial year and once approved had an obligation to notify its major precepting authorities (for business rates these were Lincolnshire County Council and the Government) of their share of the estimated surplus or deficit.

Reasons for the Decision

At the Executive meeting on 6 January 2025 the Council declared a deficit on Council Tax of £400,924 for the financial year 2024/25, of which it’s share was £56,359.

The Council would declare a deficit on the Business Rates Collection Fund of £1,150,563 for 2024/25 subject to the confirmation of the Business Rates base by 31 January 2025, of which its share was £624,225.

This deficit had arisen primarily due to the in-year and backdated element of Check Challenge and Appeals against the Ratings List.

The calculation of business rates was based on an estimate of rates collected in year compared to the estimate made the previous year, taking into account any previously declared surplus or deficit, and a forecast for the remainder of the current year.

Based on the forecast position of the in-year Collection Fund as at 31 March 2025 and taking into account an adjustment for the difference between prior year estimates compared to the actual outturn, it was estimated that there would be a deficit of £1,150,563 on the business rates element of the Collection Fund in 2024/25.