What types of property are eligible for small business rates relief?
Different types of property are eligible for this type of relief, as long as they are being used for business purposes. This could be an office, a pub, a restaurant or a shop. Local authorities collect small business rates as tax, which they use to fund local services.
Do I qualify for small business rate relief?
According to the UK government, businesses can claim small business rates relief if they meet the following criteria:
- The rateable value of your property is less than £15,000
- You use only one property to run your business.
However, the UK government states that you still may be able to qualify for small business rate relief if you have more than one property.
If you’re looking to claim charitable rate relief as well, then please note that you cannot claim both. You’ll only be able to claim either small business rates relief, or charitable rate relief. Your local council will decide which one is most suited to your business.
In order to find out if you qualify, you’ll need to check this with your local council. They will be able to help you calculate how much you’re entitled to, as well as what information you need to provide to make your claim. Any changes to your circumstances have to be reported in a new application, otherwise you do not have to make any further claims.
What is rateable value?
Rateable value is the overall value of your property. It’s decided by the Valuation Office Agency (VOA) and provided to your local council. When they complete their valuation, they’ll include factors such as whether your property has fire protection, machinery or any security systems in place, for example. This is because they may add additional value to your non-domestic property.
Every five years, the VOA will review the value of your property as well as any assets that may increase the overall property’s value. It’s also advisable to estimate your business rate every year, so that you know how much you’re expected to pay each year. You’ll also need to use the correct multiplier for the year that you’re calculating for, which the UK government provides on their website.
To calculate your business rate, you’ll have to multiply the rateable value of your property by the current multiplier. If it’s below £15,000, then you’re eligible for small business rate relief. The multiplier changes each year, and it’s currently 49.9 pence. For more information on calculating your business rate relief, please visit the UK government website.
Changes to small business rates relief following from 1 April 2023
From 1 April 2023, small businesses in England looking to claim relief may be affected by the UK government’s reevaluation of market property rateable value. As property values rise, this means that you may be entitled to less small business rates relief than before. For more information on reevaluation, please visit the UK government website page.
If your property is based in Northern Ireland or Scotland
Note that if your property is based in Scotland or Northern Ireland, your business rates may be calculated differently. For more information about how to calculate your business rates (also known as non-domestic rates) in Scotland, please refer to the Scottish government website. If you’re looking to calculate business rates for a property in Northern Ireland, the official government services NI Business Info website has more information.
Reporting a change
If the rateable value of your property is changing, or if you are occupying an additional property that you didn’t originally mention in your application, then you’ll need to report this to the Valuation Office Agency. When reporting changes, you’ll likely have to provide them with some notice. Please visit your local council’s website, or contact them in order to find out how much notice to provide.
According to the UK government website, you’ll need to pay your new rate starting from the date that your circumstances have changed.You can also use your online business rates valuation account in order to:
- Challenge your property’s rateable value
- Report possible changes in your property’s rateable value to the VOA
- Appoint an agent to help you discuss your property’s rateable value with the VOA.
Some external factors may affect your business rates. These often take the form of a local disruption, such as flooding, building or roadworks. If you are experiencing any local disruption, please report this to the VOA.
Other options if you don’t qualify for small business rates relief
If your local council informs you that you don’t qualify for small business rates relief, then you might still be eligible for a different type of business relief. You may still be able to claim for business rates relief if you are:
- a retail, hospitality or leisure business
- a charity
- a local amateur sports club
- a local newspaper
Other circumstances which may help you to claim business rates relief include the following:
- Your property is based in an enterprise zone.
- Your property is based in a freeport.
- Your property is empty, being refurbished or is partly empty.
If you’re looking for other forms of financial assistance, then consider UK small business grants as well. These come in the form of startup grants. They are usually provided to businesses looking to get their feet off the ground and can help you grow your business.
Small businesses with a rateable value of under £15,000 are eligible for small business rates relief. To find out whether you qualify, please contact your local council for more information. Even if you’re not able to claim small business rates relief, there are other kinds of business rates relief available that may be applicable to you. If the rateable value of your property is changing, then it’s a good idea to ensure that this information is up to date via your online business rates valuation account.
