Form

NNDR3: national non-domestic rates - validation notes

Updated 2 April 2024

Applies to England

Please read this form before submitting NNDR3.

The National Non-Domestic Rates (NNDR) Return 2023-24 is designed to report your authority’s non-domestic rating contribution for 2023-24 under the business rates retention system. On receipt of your form, we carry out a number of checks to satisfy ourselves that the form has been completed without errors, but it is also useful to understand why the data varies significantly from that provided from the previous year’s NNDR3 on key items within the form. To do this, we ask that you review and provide explanations in the ‘Main validation’ tab.

NNDR3 form

A number of validation checks are built into the NNDR3 form and there is space on the ‘Main Validation’ sheet for local authorities to comment on any data that have flagged the validation checks. Details of the validation fields that are included in the validation sheet in the NNDR3 form are set out below.

Even where the reason for the variance may be obvious, or out of the authority’s control (e.g. revaluation), please still check that the data matches your internal figures and provide comment. This ensures there have been no data entry errors, and also helps us to inform policy colleagues of the scale of known issues.

Messages highlighting potential errors have also been included in the form, so do please double check calculations where an error message has appeared in the form. The ‘Main validation’ tab includes a general comments box which you could use to provide further explanations on any error message remaining.

Please note we may need to contact the local authority for additional information following the validation in our database, so it is essential that full contact details are entered in the appropriate place in Part 1 of the NNDR3 form. These details will not be shared outside of the DLUHC data collection team.

General checks

Certification

The Department for Levelling Up, Housing and Communities requires the NNDR3 to be certified by the Chief Financial Officer or Section 151 officer. The Excel copy of the NNDR1 form should be sent by the Chief Financial or Section 151 officer with their e-signature and a confirmation they are happy with the figures in the form. This should be done by 30 April for the provisional version of the form, and 30 September for the final post-audit submission.

The confirmation by the Chief Financial or Section 151 officer should take the same form as the signature field in previous years, saying for the provisional form:

“I confirm that the amounts entered in this form are in accordance with schedule 7B of the Local Government Finance Act 1988 and regulations made under it.”

And for the final post-audit form:

“I certify that the amounts entered in this form are in accordance with schedule 7B of the Local Government Finance Act 1988 and regulations made under it and are consistent with the amounts for non-domestic rates in the authority’s audited Statement of Accounts.

I further certify that the amounts of s.47 rate relief for which the authority claims s.31 grant have been given to ratepayers in accordance with the relevant guidance issued by the government.”

Alterations

The NNDR3 form is an auditor-certified form. If alterations need to be made to the form, please submit a revised form, clearly indicating that the form is revised. A copy of the revised form must be certified by your CFO / S151 officer and resubmitted by email.

Arithmetic calculations

Before returning the form please ensure that all arithmetic calculations are correct and that data are specified to the correct number of decimal places. Data should be entered in £s only – pence should not be reported. We are not allowed to alter the form, even the smallest changes will need to be amended and signed by the CFO / S151 officer. The completing officer needs therefore to ensure that the correct rounding conventions are used.

Validation checks in the ‘main validation’ sheet

Mandatory reliefs (Tests 1 - 8)

We compare the mandatory reliefs with those that were provided on the NNDR3 for 2022-23. Please note that this will use the updated data that was published on 24 January 2024.

Explanation will be required if the figure for 2023-24 has changed by more than the following amounts.

Test 1

The cost of Small Business Rate Relief granted (Part 3 Line 7) - by more than 5% (either up or down) and the actual difference is more than £250,000.

Test 2

The additional yield collected to finance the Small Business Rate Relief scheme (Part 3 Line 12) - by more than 5% (either up or down).

Test 3

The cost of Charity relief (Part 3 Line 14) - by more than 10% (either up or down) and the actual difference is more than £300,000.

Test 4

The cost of Community Amateur Sports Clubs relief (Part 3 Line 16) - by more than 10% (either up or down) and the actual difference is more than £20,000.

Test 5

The cost of Rural Shops relief (Part 3 Line 18) - by more than 10% (either up or down) and the actual difference is more than £5,000.

Test 6

The cost of Public lavatories relief (Part 3 Line 21) - by more than 10% (either up or down) and the actual difference is more than £5,000.

Test 7

The cost of Partly Occupied “relief” (Part 3 Line 24) - by more than 20% (either up or down) and the actual difference is more than £100,000.

Test 8

The cost of Empty Property “relief” (Part 3 Line 26) - by more than 25% (either up or down) and the actual difference is more than £500,000.

Discretionary reliefs (Tests 9 - 15)

We compare the discretionary reliefs with that provided on the NNDR3 for 2022-23. Explanation will be required if the figure for 2023-24 has changed by more than the following amounts.

Test 9

The cost of Charity relief (Part 3 Line 29) - by more than 15% (either up or down) and the actual difference is more than £50,000.

Test 10

The cost of Non-Profit bodies’ relief (Part 3 Line 31) - by more than 15% (either up or down) and the actual difference is more than £50,000.

Test 11

The cost of Community Amateur Sports Clubs relief (Part 3 Line 33) - by more than 5% (either up or down) and the actual difference is more than £5,000.

Test 12

The cost of Rural Shops and Post Offices relief (Part 3 Line 35) - by more than 5% (either up or down) and the actual difference is more than £5,000.

Test 13

The cost of Other Small Rural Businesses relief (Part 3 Line 37) - by more than 5% (either up or down) and the actual difference is more than £5,000.

Test 14

The cost of Retail, Hospitality and Leisure (RHL) relief (Part 3 Line 59) – by more than 50% (either up or down). Note that we are aware have set this wide because of the differences in the discount given by the relief. We may need to follow up with authorities if we believe there is an issue not captured by this test.

Test 15

The cost of other s47 discretionary relief (Part 3 Line 39) - by more than 25% (either up or down) and the actual difference is more than £100,000.

Below are a few examples of the type of explanations we might expect:

• Councils may have had a change of policy and approved more/fewer reliefs.
• Charity Relief increased due to relief being given to a large leisure centre and this was not known when completing the NNDR1.
• Following publicity there is a greater number of applications received than anticipated.

We will seek further explanations if the comment provided is not adequately descriptive. Examples that are not adequate and will prompt us to send further queries are:

• Figures gone up/down
• Figures OK

Other checks (Tests 16 - 25)

We also carry out some further checks, mostly comparing figures with those provided on the NNDR3 for 2022-23. Explanation will be required if the figure for 2023-24 has changed by more than the following amounts.

Test 16

The non-domestic rating income (Part 1 line 11) - by more than 20% (either up or down) and the actual difference is more than £10,000,000.

Test 17

Gross rates payable (Part 3 reconciliation line 1 column 3) - by more than 10% (either up or down) and the actual difference is more than £10,000,000.

Test 18

The net rates payable (Part 2 line 1 column 3) - by more than 25% (either up or down).

Test 19

The sums written off (Part 2 line 3 column 3) - by more than 10% (either up or down) and the actual difference is more than £1,000,000.

Test 20

The sums outstanding from ratepayers (Part 5 line 11 column 5) - by more than 20% (either up or down) and the actual difference is more than £2,000,000.

Test 21

The sum, outstanding due to ratepayers (Part 5 line 12 column 5) - by more than 20% (either up or down) and the actual difference is more than £3,000,000.

Test 22

The non-collection closing balance (Part 5 line 16 column 5) - by more than 15% (either up or down) and the actual difference is more than £2,500,000.

Test 23

The provision for backdated appeals adjustment, closing balance (Part 5 line 24 column 5) - by more than 25% (either up or down) and the actual difference is more than £7,500,000.

Test 24

Collection Fund opening balance (Part 5 Line 26 column 5) – this is to check whether the opening balance total has been changed And we are seeking an explanation for this.

Test 25 is looking to check whether the total COVID-19 Addition Relief Fund relief to be provided in respect of 2021-22 (taken as a sum across the 2021-22, 2022-23  and 2023-24 forms) has exceeded the amount of compensation that will be paid. If this is the case, then confirmation would be helpful.

Test 25

The difference between the CARF relief (Part 3 Line 62) to be paid and the maximum amount of compensation to be paid is more than £0.