Rating Manual section 6 part 3: valuation of all property classes

Section 950: the treatment of sporting rights

This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.

1. The treatment of sporting rights following the Local Government and Rating Act 1997

This section clarifies the treatment of sporting rights following the Local Government and Rating Act 1997, which largely exempted this class of hereditament in England and Wales.

This section explains the application of a number of provisions of S.2 of the Local Government and Rating Act 1997, which came into force on 1st April 1997, and abolished the rating of sporting rights. Full details of its application are given in Appendix 1 to this section.

2. The Legislation

2.1 Section 2(1) LGRA1997 amended Part III of LGFA 1988 Act in sub section (2) to (6) which are reproduced as follows:-

Extract From Lgra 1997

“2. - (1) Part III of the 1988 Act is amended as set out in subsections (2) to (6) (which provide for the abolition of liability to non-domestic rating in respect of sporting rights).

(2) In section 64(4) (relevant hereditaments), paragraph (d) (rights of sporting severed from occupation of land) is omitted.

(3) In section 65 (owners and occupiers of hereditaments or land)-

(a) in subsection (3), for “subsections (4) to (9) below” there is substituted “the following provisions of this section”, and

(b) subsection (9) (owners and occupiers of rights of sporting) is omitted

(4) In Schedule 5 (hereditaments exempt from local non-domestic rating), paragraphs 10 (certain fishing rights) and 14(3) (fishing and shooting rights of drainage authorities) are omitted.

5) In Schedule 6 (rateable value of non-domestic hereditaments), after paragraph 2B there is inserted-

“2C. - (1) This paragraph applies where-

(a) a hereditament consists wholly or in part of land on which a right of sporting is exercisable; and

(b) the right is not severed from the occupation of the land.

(2) For the purposes of determining the rateable value of the hereditament under paragraph 2 above, the rent at which the hereditament might reasonably be expected to let shall be estimated as if the right of sporting did not exist.

(3) In this paragraph “right of sporting” means a right of fowling, shooting, taking or killing game or rabbits, or fishing.”

2.2 These provisions should be read in conjunction with any parts of s64, s65 and para 10 and 14 Sch 5 LGFA 1988 referred to in s.2 of the 1997 Act, and apply to any rateable sporting rights from 1.4.1997.

2.3 In summary the 1997 Act:-

a. Omitted s.64(4)(d) from the LGFA 1988. (This section provided that certain sporting rights severed from the occupation of the land over which they were exercisable were to be regarded as rateable property). Thus severed sporting right hereditaments ceased to be rateable after 1.4.97.

b.Added a new paragraph, para 2C, to Sch 6 LGFA 1988, which provided for relief from rate liability for any hereditament that consists wholly or in part of land on which a sporting right is exercisable, and that right is not severed from the occupation of the land.

c.In such cases “the rateable value of such hereditaments are to be calculated as though the sporting right does not exist.”

3. The Application of the Legislation

3.1 Hereditaments comprising severed rights were deleted from the relevant Rating Lists by Valuation Officers, with effect from 1.4.97.

3.2 The application of the relief to qualifying hereditaments that consist wholly or partly of land, in respect of the revised para 2C Sch 6 LGFA 1988 can prove to be more problematical, particularly in relation to reports received from Billing Authorities in relation to new hereditaments.

3.3 Full notes for guidance on the application of s.2 Local Government and Rating Act 1997 abolishing the rating of sporting rights and examples of the application of the all the amendments are set out in Appendix 1

The Examples Cover

  1. Application of s.2(2) which abolished hereditaments comprising a severed sporting right as provided in S.64(4)(d) LGFA 1988.

  2. Application of the relief in s.2(5) to hereditaments in whole or part, comprising “lands” on which a right of sporting is exercisable.

  • Hereditaments qualifying for relief under s.2(5) LGRA 1997

  • Rights of sporting included for relief

  • The extent of the relief

  1. Application of relief in the case of qualifying hereditaments.
  • land/land covered by water/artificial lakes and ponds used for exercising sporting rights

  • land/land covered by water/artificial lakes and ponds used solely in connection with sporting rights

  • ancillary facilities to above

  1. Land, including land covered by water, and buildings, used for exercising a sporting right and other uses, e.g. sailing.

  2. Commercial fisheries and shoots, and/or sporting rights forming part of an otherwise exempt hereditament.

  3. Sporting Rights owned by the Crown and by Statutory Authorities/privatised companies.

3.4 Any cases of difficulty or further problems that need clarification in respect of the application of s.2 LGRA 1997, should be submitted via team leaders to CEO Technical Advisers.

Appendix 1: The treatment of Sporting Rights

Notes For Guidance On The Application Of S.2 Local Government And Rating Act 1997 Abolishing The Rating Of Sporting Rights

1. Application of s.2(2) which abolished hereditaments comprising a severed sporting right as provided in S.64(4)(d) LGFA 1988

S.2 (2) LGRA 1997 provides that *severed sporting rights are no longer rateable property. Under Section .64(4)(d) LGFA1988, a hereditament was a relevant hereditament if it comprised of any right of sporting (that is, any right of fowling, of shooting, of taking or killing game or rabbits, or of fishing) when severed from the occupation of the land on which the right is exercisable. Accordingly, only certain sporting rights, i.e. those reserved out of a tenancy for the occupation of the land, or granted separately by deed and severed from the occupation of the land comprised separately rateable property under this provision.

1.2 All relevant hereditaments which were shown in Rating Lists that wholly consisted of severed sporting rights, as defined in S.64(4)(d) LGFA 1988, were deleted from Lists with effect from 1 April 1997.

1.3 Any value of the right to stock or keeper the land attached to such rights, does not amount to a separate occupation of land, and should be ignored as there is no rateable hereditament to which they can be attached after 1.4.97.

1.4 See example 2.5.2 and example 3 below in respect of any other ancillary facilities such as car parks and club houses that form part of the same hereditament as the severed right, or separate hereditaments.

2. Application of the relief in S2(5) LGRA 1997 applies to hereditaments comprising “lands” in S64 (4)(a) LGFA 1998) from which a right of sporting has not been severed

2.1 Paragraph 2C, in Sch 6 LGFA 1988 applies relief to hereditaments that consist wholly or in part of land on which a right of sporting is exercisable, and the right of sporting is not severed from the occupation of the land – referred to hereafter as “qualifying hereditaments”.

2.2 Rights of sporting included for relief

Rights of sporting qualifying for relief are defined in the new para 2C(3) (inserted in Sch 6 LGFA 1988 by S. 2(5) LGRA 1997) which provides:-

“in this paragraph “right of sporting” means a right of fowling, shooting, taking or killing game or rabbits, or fishing”.

2.3 The extent of the relief

Part 2C(2) Sch 6 provides that the rateable value (of a qualifying hereditament) shall be calculated after 1.4.97 as though the right of sporting does not exist.

Thus any relevant hereditament or part of a hereditament consisting of “lands” in S.64(4)(a) is entitled to relief, by ignoring value attributable to an exercisable sporting right. This applies whether or not the right is exercisable by the occupier of the land, or let to a third party.

3. Examples of the application of relief in the case of qualifying hereditaments.

3.1 Land (including land covered by water, or artificial lakes and ponds) used solely for exercising a sporting right or rights defined in para 2C(3) Sch 5.

3.1.1 It must be assumed for valuation purposes only that the sporting right does not exist. Property would not be valued for rating purposes, for example, if the land met any of the qualifying agricultural exemption provisions within para 2(1) Sch 5 LGFA 1988.

In this example, if the agricultural and sporting use is mutually exclusive, or any agricultural use is mainly for the benefit of the sporting right, e.g. grazing of sheep on grouse moors, there would be no qualifying relevant hereditament shown in the Rating List and no residual value.

The residual rights relating to land covered by water, or artificial lakes and ponds has caused difficulties in the past but where the land covered by water has no beneficial value other than for the benefit of the sporting right, no rateable value should be attached to the nominal right.

3.2 Land (including land covered by water or artificial lakes and ponds) and ancillary facilities only used in connection with sporting rights defined in para 2C Sch 5.

When the qualifying relevant hereditament has been identified, the RV is calculated as in 2.3 above on the assumption that the right of sporting does not exist.

3.3 Ancillary facilities

Ancillary facilities in themselves and those that form a separate hereditament from that over which the right is exercisable are not sporting rights defined in para 2C(3) Sch 5, therefore prima facie relief does not apply to such property. Examples of ancillary facilities include fishing cabins providing shelter to members of the fishing club, bothes, a boathouse etc.

3.3.1 Ancillary facilities with no residual value

However, if the ancillary facility is part of the land over which there is a right qualifying for relief, and the value is deminimis in the assumed absence of the sporting right no assessment should be raised. For example, feeding pens for game in woodlands where the shooting takes place, small shelters for fishermen by the lake are part of the qualifying hereditament, but may have no value apart from the rights which are assumed not to exist Also, stands for fishing, or shooting butts, included in the same hereditament as an un-severed right, may have no value apart from the sporting right, unless there is another use that is more than de minimis in value – see 3.32 below.

Similarly, land covered with water (see 3.1 above) and used for fishing would be entitled to relief, and also in the closed season (times of the year when the right to fish may not be exercised) which is usually the breeding season. Hatcheries for rearing fish for transfer to a fishing pond, or other waters such as a river or lake, being in the same hereditament would not attract relief, but may be exempt as provided in para 9 Sch 5 LGFA 1988 anyway, if that is their sole use.

3.3.2 Ancillary facilities that do not attract relief

(i) Huts/stores that do not have a nil value, or de minimis value, should be valued and shown in the list.

(ii) Rearing facilities located on land over which a right of sporting is not exercisable would not appear to come within the relief in para 2C. Similarly, such facilities enjoyed with severed rights would not attract relief, where they were part of the services provided by the landlord occupying the land, In either case, where there was no agricultural exemption for land used for rearing/keeping game for shooting, such land will remain wholly rateable.

(iii) Permanent private car parking, and buildings such as a clubhouse or other structure e.g. a car park with a club house will not usually be subject of relief in para 2C Sch 6.

(iv) Domestic property such as keepers cottages shown in Council Tax Valuation lists cannot qualify for relief.

4. Land, including land covered by water, and buildings used for exercising a sporting right and other uses e.g. sailing

4.3.1 This case includes sporting rights attached to land, exercisable on reservoirs or lakes which are also used also for boating or sailing. Any relief will only apply to any rateable value in respect of any exercisable sporting right attached to land (or land covered by water). Value generated by other uses falls to be rateable – see 3.2 above

4.3.2 No apportionment of any joint use of car parking or club houses, shops, cafes etc. need be considered for relief – see 3.2 above.

5. Commercial fisheries and shoots, and/or sporting rights forming part of an otherwise exempt hereditament

For the avoidance of doubt all commercial sporting rights let by the rod/gun per hour/day/week etc. are encompassed by the provisions of S2 LGRA 1997, whether they were rateable prior to 1.4.97 either as “severed rights” in S64(d), or “lands” in S64(a). They should be treated in the same way as those at items 1 to 3 above, depending on the constitution of the property forming the hereditament.

6. Sporting Rights owned by the Crown and by statutory Authorities/privatised companies

The provisions of S2(2) and (5) LGRA 1997 appear to apply equally to hereditaments where the Crown (see S3 LGRA 1997), or a statutory authority/privatised company are the rateable occupiers of hereditaments comprising or including sporting rights, which are, or may be shown in either local, or if any in central, NDR lists.