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2.1 Qualifying works must result in a positive value once value suppressing activity has been accounted for. Any improvements which result in no overall changes in rateable value due to associated value-supressing activity, such as demolition works, will not be eligible for relief.

2.2 To fall within the meaning of qualifying works, the improvements will need to produce:

• an increase in the amount of the area of buildings comprised in the hereditament
• other improvements or upgrades to the propertys physical state which might include addition of heating, air conditioning, or raised flooring; or
• addition of rateable plant and machinery
• works associated with the above to the extent that the associated works reduce the net increase in RV resulting from the above works

2.3 Examples of the type of works which may meet the definition of qualifying works include:

• a business adds insulation or new lining to a previously uninsulated old industrial building resulting in an increased rateable value
• a business builds an extension to their property
• a shop removes a structural wall increasing its rateable value by making a rear storage area (previously behind the wall) available for retailing
• a business adds a mezzanine sales floor within its retail warehouse
• a large factory site builds a new building within the site area that forms part of its hereditament

2.4 A change of use, for example a change from a shop to a bar, would not on its own constitute qualifying works. But any of the works referred to at 2.2 associated with such a change of use might still be eligible.

2.5 Where a scheme of works results in a new hereditament, the VO must certify the change in rateable value attributable to the qualifying new works for the new hereditament. Where there have already been qualifying works to a property which is subsequently reconstituted by a split or a merger, improvement relief may remain relevant to that part subject to the qualifying works if it has continued to remain occupied by a qualifying occupier.

2.6 When calculating the change in rateable value, if any, attributable to qualifying works, regard must be had to any associated value suppressing activities which reduce the RV. This would include demolitions which are part of preparatory works undertaken ahead of constructing new buildings. In other words, it is the net effect of the whole works which must be certified. When deciding if value suppressing activities are works associated with other qualifying works, it will be necessary to consider geographical and temporal proximity.

2.7 The closer, in terms of location and time, value suppressing activities are to qualifying improvement work, the more likely it is that they are associated with the qualifying works and so should be considered when calculating the amount to be certified. Whilst there can be no hard and fast rules, it may be reasonable to assume that value suppressing activities within 6 months of qualifying works are associated with those works whilst similar value suppressing activities taking place 18 months before or after the qualifying works may not be associated with those works. In a similar manner, a demolition which took place prior to erecting a new building in the same location is likely to be associated with the qualifying works whilst a demolition elsewhere within the hereditaments site may not be associated with the erection of the new building.

2.8 In most cases it will be apparent whether or not value suppressing activities are associated with qualifying improvement works but technical advice should be sought in cases of doubt. Where they are associated, the reduction in RV caused by the value suppressing activity must be reflected in the certified value for the qualifying works.

2.9 Examples of types of works which would not meet the definition of qualifying works include:

• construction of a new building creating a hereditament new to the list
• a programme of redevelopment which results in deletion of a hereditament from the rating list for the duration of the works where the substantially redeveloped property is then brought back into the rating list as a new
• repairs or replacement of old technology such as asbestos lining with a modern equivalent with no change in rateable value
• addition of land and/ or construction of a new building on such land outside the existing hereditament

3.1 The intention of improvement relief is to support ratepayers invest in their own active businesses.

3.2 To ensure support is not diverted to developers or landlords inheriting improvements from a previous occupier, after certification by the VO, billing authorities apply a further test - the occupation condition and need to be satisfied that in the period since qualifying works commenced, the property has remained occupied and the ratepayer has not changed.