Kirstie Goulder

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Business rates and Property Guardian Companies: some welcome clarity

Property Guardianship / 17 October 2019

Last November, we reported on the case relating to ‘Ludgate House’ (click here) whereby the Valuation Tribunal (“VT”) had to determine whether a guardian-occupied building, in whole or in part, was used ‘wholly for the purposes of living accommodation’. 

The Upper Tribunal (“UT”) has now clarified the identification of the unit of assessment for buildings occupied by property guardians.


At first instance, the VT held that, based on the particular facts of the case, the whole of Ludgate House was a single, non-domestic “hereditament” in the occupation of its owner, Ludgate House Limited. In reaching its decision, the VT focussed on considerable size of Ludgate House in comparison to the small amount of space actually occupied by the guardians.

It also determined that the property was, therefore, subject to non-domestic rates.  These would be backdated to 2015.

That decision was appealed to the UT, who disagreed with the first instance decision. The UT considered the VT’s focus on the size of the property in comparison to the number of guardians to be wrong. In reaching its decision, instead it concentrated on the nature and purpose of the guardians’ occupation as effectively residential, rather than supplying security services. The UT determined that the guardians in this property were each in occupation of a dedicated room, of which they were exclusive occupiers, and that these rooms amounted to four distinct units of occupation capable of being recognised as separate hereditaments.


This decision provides some welcome clarity on the issue of identifying the hereditament in property guardian cases. This opens the door for property guardian companies to continue to advertise the benefit of using property guardians to mitigate liability for non-domestic rates (assuming other recommended best practices are followed). The valuation of such hereditaments once identified and/or multi-use buildings offering temporary accommodation and workspace however, are a whole different ballgame!

Our Property Guardianship team continue to advise property guardian companies throughout the UK on multiple issues. We are delighted to have been recognised in the Legal 500 for a second year running for our expertise in the sector, with Amy Castleman and Kirstie Goulder attributed “Rising Star” status and Kathryn Gilbertson continuing to be a “leading light” for her regulatory work. If you have any issues relating to property guardianship you would like to discuss, please get in touch.


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This update is for general purposes and guidance only and does not constitute legal or professional advice. You should seek legal advice before relying on its content. This update relates to the prevailing circumstances at the date of its original publication and may not have been updated to reflect subsequent developments. If you have general queries about our updates, please email:

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