If you pay business rates, your property may be eligible for business rates relief. Business rates are taxes to help pay for local services. They’re charged on most non-domestic properties. This information applies to England only – rates relief is handled differently in Scotland, Wales and Northern Ireland.
Your local council will automatically apply some reliefs. You have to apply for the following reliefs:
- Small business rate relief
- Rural rate relief
- Business rates deferral scheme
- Charitable rate relief
- Enterprise zone relief
Some local councils provide an additional hardship relief if your business meets certain criteria. Contact your local council to find out more.
Contact your local council if you’re not getting any reliefs you think you’re entitled to.
Small business rate relief
You can get small business rate relief if:
- You only use one property
- Its rateable value is less than £12,000
What you get
Until 31 March 2014 you’ll get 100% relief (doubled from the usual rate of 50%) for properties with a rateable value of £6,000 or less. This means you won’t pay business rates on properties with a rateable value of £6,000 or less.
The rate of relief will gradually decrease from 100% to 0% for properties with a rateable value between £6,001 and £12,000.
You have more than one property
You could get small business rate relief if the rateable value of each of your other properties is less than £2,600. The rateable values of the properties are added together and the relief applied to the main property.
Contact your local council to apply for small business rate relief.
You’re a small business but don’t qualify for relief
If your property has a rateable value below £18,000 (£25,500 in Greater London) you’re considered a small business. Even if you don’t qualify for small business rate relief, your business rates will be calculated using the small business multiplier instead of the standard one. This is the case even if you have multiple properties.
The multiplier shows the percentage (pence in the pound) of the rateable value that you pay in business rates. A list of current multipliers is on the Valuation Office Agency (VOA) website.
Transitional rate relief
If the rateable value of your property changes significantly as a result of revaluation, your rates will change gradually. This is called ‘transitional relief’.
If you get transitional relief, your local council will include this automatically when working out what business rates you should pay. A small property is a property with a 2010 rateable value below £18,000 (£25,500 within Greater London). All other properties are large properties. There are limits on how much your rates can increase or decrease.
Rate increase limits
|Year||Small property||Large property|
|2010 to 2011||5%||12.5%|
|2011 to 2012||7.5%||17.5%|
|2012 to 2013||10%||20%|
|2013 to 2014||15%||25%|
|2014 to 2015||15%||25%|
Rates decrease limits
|Year||Small property||Large property|
|2010 to 2011||20%||4.6%|
|2011 to 2012||30%||6.7%|
|2012 to 2013||35%||7%|
|2013 to 2014||55%||13%|
|2014 to 2015||55%||13%|
Rural rate relief
If your business is in a rural area with a population below 3,000 you could get rural rate relief. You get between 50% and 100% off your business rates.
You can get relief if your business is:
- The only village shop or post office with a rateable value of up to £8,500
- The only public house or petrol station with a rateable value of up to £12,500
Local councils can also:
- Top up the mandatory 50% relief to 100%
- Give relief to other rural retail businesses of up to 100% (for properties with a rateable value under £16,500)
Contact your local council to see if you can get additional rate reliefs.
This lets you spread the Retail Price Index increase of your 2012 business rates bill over 3 years. This is 3.2% of your 2012 to 2013 bill, which you can choose to pay over the next 2 financial years (half in each year). You have to pay your full business rates for those years.
When to apply
You can apply until 31 March 2013 as long as you still have some of your bill left to pay. You can defer 3.2% of the whole year’s 2012 to 2013 bill regardless of when you apply.
How to apply
If you have more than one property in the same council area you only have to send one form to your local council. If you have properties in different council areas, you’ll have to send a form to each council.
If you leave a property you must pay all the business rates you still owe, including the amount you’ve deferred.
If you’re behind in paying your business rates, your local council might not let you use this scheme.
Charitable rate relief
Charities and amateur community sports clubs can apply for relief of up to 80% if a property is used for charitable purposes. Check with your local council to see if you are eligible. You should also check if you can get additional ‘discretionary relief’ (up to 100%). This is sometimes provided by local councils to ‘top up’ certain reliefs to give businesses and charities extra help.
If you’re starting up or relocating to an enterprise zone, you’ll qualify for enterprise zone relief. You must start up or relocate by April 2015. The council works out how the business rate relief is applied. You can get up to 100% business rate relief for 5 years, up to a maximum of £275,000. Contact the enterprise zone area to find out how to apply.
The enterprise zones are:
- Black Country i54 and Darlaston
- Cornwall and Isles of Scilly Newquay Aerohub
- D2N2 (Derby, Derbyshire, Nottingham and Nottinghamshire)
- Greater Birmingham and Solihull City Centre
- Greater Cambridge and Greater Peterborough Alconbury Airfield
- Greater Manchester Airport
- Humber Estuary Renewable Energy Super Cluster and Green Port Corridor
- Humber Green Port Corridor
- Leeds Lower Aire Valley
- Leicester and Leicestershire Mira Technology Park
- Liverpool Daresbury Science Campus
- Liverpool Mersey Waters
- London Royal Docks
- New Anglia Great Yarmouth and Lowestoft
- North Eastern River Tyne and Nissan Site
- Oxfordshire Science Vale UK
- Sheffield Modern Manufacturing and Technology Growth Area
- Solent Daedalus Airfield
- South East Midlands Northampton Waterside
- South East Sandwich and Harlow
- Tees Valley
- The Marches Hereford
- West of England Temple Quarter (Bristol)
Exempted buildings and empty buildings relief
Certain properties are exempt from business rates. Exemptions include:
- Agricultural land and buildings, including fish farms
- Use of buildings for training or welfare of disabled people
- Buildings registered for public religious worship or church halls
You don’t have to pay business rates on empty buildings for 3 months. After this time, most businesses must pay full business rates. Some properties can get extended empty property relief:
- Industrial premises (eg warehouses) are exempt for a further 3 months
- Listed buildings – until they are reoccupied
- Buildings with a rateable value under £2,600 – until they are reoccupied
- Properties owned by charities (only if the property’s next use will be mostly for charitable purposes)
- Community amateur sports clubs buildings (only if the next use will be mostly as a sports club)
You need to contact your local council to let them know when your property becomes vacant.At Bizorb we aim to provide the most accurate and up to date information to you. This article contains public sector information licensed under the Open Government Licence v1.0. If you spot any errors in this article please let us know.