Retailers need to challenge the business rates revaluation in 2005 or face over-paying by millions of pounds, according to business advisor KPMG.

KPMG has warned retailers that they are likely to face rate hikes because the rateable value is linked to rental costs, which have spiralled by 24% over the past five years. However, the retail warehouse sector could be hardest hit as rents have risen by 33% over the same period.

Business rates are second only to rent in terms of property occupancy costs and KPMG has calculated that retailers could save 20% if they challenged the rate review. KPMG’s head of retail Amanda Aldridge said: “For the 1990 and 1995 valuation lists, over 1.5 million appeals were launched against the levels of rates being charged - half of which resulted in rate reductions with average savings of 20%.”

She said businesses could benefit from a raft of local property tax allowances, reliefs and exemptions. “I would always advocate that businesses keep a much closer eye on the business rate charge, challenge it where necessary and make the most of all available allowances. With the clock ticking in the run-up to the next revaluation the time to act on this is now.”