The expert will follow a set procedure and charge a fixed fee. Both the landlord and tenant must agree to use the scheme, and by doing so, they will benefit from getting the rent fixed quickly, cheaply and efficiently.
Why use the Small Business Scheme for rent reviews?
The scheme offers:
- An independent and fair review
- Fixed rate fee
- Backing and experience of RICS
- Flexibility to appoint additional advisors if necessary
When deciding whether or not to use the scheme, landlords and tenants should bear in mind that if they do not, the rent review may still go ahead using the procedure set out in the lease, which may result in a more expensive procedure than envisaged under this scheme.
Under this scheme, the independent expert will make his or her own investigations and rely on the market knowledge to reach a decision. The parties may feel they can rely on this expertise and not instruct their own valuers which will keep the costs down. However, the scheme allows them to use their own valuers and to submit evidence if they wish, although the independent expert will not be bound to rely upon this material.
Once both parties have signed up to the scheme, if one party then fails to co-operate, the scheme enables the independent expert to reach a decision but also ensures that he or she will have the benefit of the views, opinion or other evidence provided by the party who does co-operate.
Am I eligible to use the scheme?
The scheme is intended for rent reviews of small commercial properties occupied by small business in England and Wales. The two eligibility criteria are:
- The property’s rateable value must be less than £10,000 (£15,000 in London); and
- The property is one of a maximum of two non-residential properties held by the tenant.
The scheme applies where there are no legal issues involved, the disputes must be a matter of pure valuation (However, if parties can resolve their legal issues separately or the expert agrees to deal with them, then the scheme can be used). A reasoned determination will not be given but the expert will indicate briefly why this decision has been reached.
Costs
The scheme works on a capped-fee basis, and the maximum cost of using the scheme for the landlord and tenant will be £510 each (inc. VAT), plus any reasonable out of pocket expenses charged by the expert.
The costs are made up as follows:
- There is a charge of £100 plus VAT for the appointment.
- The independent expert’s fee, which the parties can negotiate with the parties upon appointment, will not exceed £750 plus VAT.
These fees will be shared equally between the parties. (if either party has its own professional advisors, it will be responsible for their fees).
Download the Application Form
Published date: 29 September 2023
The regulatory functions of RICS relating to Dispute Resolution Service are led and overseen by the Standards and Regulation Board (SRB).
Contact the DRS team
- RICS Dispute Resolution Service
55 Colmore Row
Birmingham
B3 2AA - Call: +44 (0) 20 7334 3806
- Email us