Non-Domestic Rates, or business rates, collected by councils, , are the way that those who occupy business (non domestic) property contribute towards the cost of local services.
Under the business rates retention arrangements introduced from 1 April 2013, councils keep a proportion of the business rates paid locally. This provides a direct financial incentive for councils to work with local businesses to create a favourable local environment for growth, since public services will benefit from growth in business rates revenues.
The money, together with revenue from council taxpayers and certain other sums, is used to pay for the services provided by local authorities in your area. You can find more information about the business rates system, including transitional and other reliefs, on GOV.UK.
Apart from properties that are exempt from business rates, each non-domestic property has a rateable value which is set by the Valuation Office Agency (VOA), an agency of Her Majesty’s Revenue and Customs. They draw up and maintain a full list of all rateable values.
The rateable value of your property is shown on the front of your bill. This broadly represents the yearly rent the property could have been let for on the open market on a particular date. For the revaluation that came into effect on 1 April 2017, this date was set as 1 April 2015.
For more information about revaluations go to the Revaluation 2017 section of this guide
The valuation officer may alter the value if circumstances change.
The ratepayer (and certain others who have an interest in the property) can challenge the value shown in the list if they believe it's wrong. They can do this through the Check, Challenge, Appeal (CCA) process introduced in April 2017.
Your council, which is the billing authority, can only backdate any business rates rebate to the date from which any change takes effect. You can find more information about the grounds on which appeals may be made.
National Non-Domestic rating multiplier
The council works out the business rates bill by multiplying the rateable value of the property by the appropriate multiplier.
There are two multipliers: the standard non-domestic rating multiplier and the small business non-domestic rating multiplier.
Except in the City of London where special arrangements apply, the government sets the multipliers for each financial year for the whole of England.
The current multipliers are shown on the front of your bill.
The council does not set either the rateable value or the multiplier. More information on how to estimate your business rates can be found on the gov.uk website
Business rates instalments
Payment of business rates bills is automatically set on a 10 monthly cycle. However, the government has put in place regulations that allow businesses to require their local authority to enable payments to be made through 12 monthly instalments. If you wish to take up this offer, you should contact the council and soon as possible.
The Budget announcement made on 3rd March 2021 delayed our normal annual billing procedure. That means those on a 12 month plan with a due date of 1st April will have 11 monthly instalments for this tax year only starting 1 May 2021.
If you get the three month Retail Discount, you will receive a revised bill showing the 66% discount for the period 1st July to 31st March 2022 in June.
Revaluation 2017 and transitional arrangements
All rateable values are reassessed periodically at a general revaluation. The most recent revaluation took effect from 1 April 2017.
Revaluations make sure each ratepayer pays their fair contribution and no more. They aim to ensure that the share of the national rates bill paid by any one ratepayer reflects changes in the value of their property over time.
A £3.6 billion transitional relief scheme limits changes in business rate bills as a result of the 2017 revaluation. To help pay for the limits on increases in bills, there are also limits on reductions in bills.
Under these transitional arrangements, limits continue to apply to yearly increases and decreases until the full amount is due (rateable value times the appropriate multiplier). The scheme applies from the date when the revaluation takes effect.
If there are any changes to the property after 1 April 2017, transitional arrangements will not normally apply to the part of a bill that relates to any increase in rateable value due to those changes.
Changes to your bill as a result of other reasons (like changes to the amount of small business rate relief) are not covered by the transitional arrangements. The transitional arrangements are applied automatically and are shown on the front of your bill. You can find more information about transitional arrangements and other reliefs on gov.uk. You can also find more information on the 2017 revaluation.
In the 2021 Budget, the government announced a three month full discount for eligible retail, hospitality and leisure businesses.
This is to be followed by a 66% discount (subject to state aid) from 1 July 2021 with a capped value of either £105, 000 or £2 million depending on whether you were legally allowed to open during the national lockdown starting 5 January 2021.
This scheme will run for one year from April 2021. This discount will be applied to the bill after the application of any reliefs, excluding any local discounts. The government has issued guidance on the operation of the scheme.
Small business rate relief
Ratepayers who occupy a property with a rateable value which does not exceed £50,999 (and who are not entitled to other mandatory relief or are liable for unoccupied property rates) will have their bills calculated using the lower small business non-domestic rating multiplier, rather than the national non-domestic rating multiplier.
In addition if the sole or main property is shown on the rating list with a rateable value which does not exceed £15,000, the ratepayer will generally receive a percentage reduction in their rates bill for this property of up to a maximum of 100%.
For a property with a rateable value of no more than £12,000, the ratepayer will receive a 100% reduction in their rates bill. Generally, this percentage reduction (relief) is only available to ratepayers who occupy either:
- one property
- one main property and other additional properties providing those additional properties each have a rateable value which does not exceed £2,899
The aggregate rateable value of all the properties mentioned in (b) must not exceed £19,999 outside London or £27,999 in London on each day for which relief is being sought. If the rateable value, or aggregate rateable value, increases above those levels, relief will cease from the day of the increase.
The government has introduced additional support to small businesses. For those businesses that take on an additional property which would normally have meant the loss of small business rate relief, the government has confirmed that they will be allowed to keep that relief for a period of 12 months. Where a ratepayer meets the eligibility criteria and has not received the relief, they should contact the council.
Provided the ratepayer continues to satisfy the conditions for relief which apply at the relevant time, , they will automatically continue to receive relief in each new valuation period.
If you are a ratepayer receiving business rates relief, you will need to tell the council about the following changes in circumstances: the ratepayer has taken up occupation of an additional property there is an increase in the rateable value of a property occupied by the ratepayer in an area other than Brighton & Hove.
Unoccupied property rating
- Business rates will not be payable in the first three months that a property is empty. This is extended to six months in the case of some industrial properties. After this period, rates are payable in full.
- In most cases the unoccupied property rate is zero for properties owned by charities and community amateur sports clubs.
- There are some exemptions from the unoccupied property rate.
Partly occupied property relief
- A ratepayer is liable for the full non-domestic rate whether a property is wholly occupied or only partly occupied.
- Where a property is partly occupied for a short time, the council has discretion in certain cases to award relief in respect of the unoccupied part.
Charity and community amateur sports club relief
Charities and registered community amateur sports clubs are entitled to 80% relief where the property is occupied by the charity or the club, and is wholly or mainly used for charitable purposes ( of that and other charities), or for the purposes of the club ( of that and other clubs).
The council has discretion to give further relief on the remaining bill. You can get full details from the council about this.
Spring budget 2017 relief scheme: supporting small business
Ratepayers losing Small Business or Rural Rate Relief as a result of the 2017 revaluation will have their increases limited to the greater of either a cash value of £600 per year or the matching cap on increases for small properties in the transitional relief scheme.
This relief will run until the next revaluation in 2023 and ratepayers will receive the relief until this date or until they reach what their bill would have been without the relief scheme, whichever is first.
We have a general power to grant discretionary local discounts.
The Brexit transition period ended on 1 January 2021. New rules on state aid now apply.
State aid is any advantage granted by public authorities through state resources on a selective basis to any organisations that could potentially distort competition and trade in the European Union (EU).
EU State aid rules only apply in certain limited circumstances but can apply to:
- tax breaks
Payments made under the Covid-19 business support schemes count towards this total.
If you are in receipt of state aid we will ask you to complete a declaration confirming that you will not exceed the relevant state aid threshold.
We will write to you each time a discount or a rate relief is subject to state aid.
We have discretion to give hardship relief in specific circumstances.
The Valuation Office Agency are contacting businesses in readiness for the next revaluation currently due 2023-24.
Business Rates review
Central Government are currently undertaking a fundamental review of business rates due to be published in the Autumn.
Ratepayers do not have to be represented in discussions about their rateable value or their rates bill.
Ratepayers who do wish to be represented should be aware that members of the Royal Institution of Chartered Surveyors and the Institute of Revenues, Rating and Valuation are qualified and are regulated by rules of professional conduct designed to protect the public from misconduct