§ Dr. Spink
To ask the Secretary of State for the Environment what directives he has given to local authorities regarding the treatment of small shops, and other small properties which are used for both business and domestic purposes, as single units for taxation purposes; and if he will make a statement.
§ Mr. Baldry
Properties are liable for council tax only where the occupier works from home, but the part of the premises used for business reverts to domestic use at the end of the day. Composite properties are treated as two units for local taxation purposes. The domestic part is liable for council tax, the business premises are liable for non-domestic rates. The domestic part will attract council tax transitional relief, where applicable, in the ordinary way. Composite properties have been afforded greater transitional protection than other properties from any adverse impact of the 1990 rating changes, and it is proposed that no such property should face a real rate increase in 1994–95. Government guidelines to local authorities on hardship relief for ratepayers draw attention to the special circumstances of composite properties, but it is for authorities to decide whether to grant any relief.