Millions of pounds in Business rates fraud estimated

It is estimated that there could be over £25 million worth of fraud being perpetuated by businesses falsely claiming Small Business Rates Relief across England, according to data analytics specialist Destin Solutions.

Small Business Rates Relief (SBRR) is provided to a number of businesses across England on the basis that they either only use one property or have a rateable value of less than £15,000. Historically information provided by small businesses claiming relief has been extremely difficult for local authorities to verify due to lack of resources and an inability to access a country-wide view of businesses and the properties they occupy.

In response, Destin Solutions have developed and launched a ratepayer data pooling portal called HUB to tackle this issue.

HUB suite consolidates all business rates information published by 98.5% of English Local Authorities who make this information publicly available. This data incorporates rateable value of properties, relief currently assigned to properties, as well as addresses and names of companies. The data is inputted into a business intelligence portal that Authorities can access, query and view.”

What was subsequently uncovered following the merging, consolidation and processing of over 1.3 million hereditaments with a combined rateable value of £23 billion, was that a number of businesses claiming relief have been doing this erroneously or falsely. A significant number of businesses had other branches set up in neighbouring and other Authorities and are therefore not entitled to the relief they are claiming.

Reinforcing this point, Destin Solutions recently hosted a technology open day and decided to review and query the data held in HUB for the 24 Authorities who were attending on the day to identify any instances of potential fraud. The results pinpointed that across those 24 Authorities, there was a staggering £2.68m worth of suspicious claims requiring further investigation.

These 24 authorities represent just over 7% of English Authorities meaning that the actual figure for fraud will be significantly higher and for cash-strapped Authorities, recovery of funds and cutting down on fraudulent claims will provide a much-needed boost to finances.

Duncan Baxter goes on to comment “our inability in the past to gain a single country-wide view of all ‘ratepayers’, has led to a situation where I think businesses think they can get away with not declaring the full extent of their operation. We now have a very strong deterrent and the fact that HUB requires no input or additional effort from Local Authorities and is available now, means we can start tackling the problem head-on.”