Notional Rent Abatements for Extensions

Q. We've had an extension built using various funding and have been told by the PCT that we can't get any Notional Rent increases for the practice. Is this correct?

A. Whether a practice can receive Notional Rent for an extension will depend on how the scheme was originally funded and if any terms were put in place. If the extension was fully funded (100%) by the PCT or Deanery, practices should only expect to receive an additional 10% to cover normal landlord expenses for the increased space created in the extension for the next 10 years. However, this is not always the case as the PCT/Deanery may have agreed to provide the full funding but may have created a clause stating that the management fee will not be paid. If this has been specifically documented then the practice will not be eligible for Notional Rent for the extension.

If the practice part contributed to the scheme, for example a 50% split, they should expect to receive an abated Notional Rent of 50% for the space, plus the 10% addition for normal landord expenses for 10 years, so 60% of the Notional Rent applicable for the extension. Again though, if the PCT/Deanery has contributed they may have put a clause in saying the 10% will not be paid.

If the extension has been paid 100% by the practice, then they should receive full reimbursement for the space.

The surgery will only be entitled to reimbursement if approval for the scheme was granted by the PCT prior to the work being undertaken and an application to its PCT has been made for notional rent payments. PCTs are within their right to refuse funding if the extension scheme has not been approved by them.

If you have a question you'd like to ask one of our Surveyors, please do not hesitate to contact GP Surveyors. More information about Notional Rent Reimbursement can be found here

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