Business rates explanatory notes 2016/17
Non-domestic rates (also called business rates) are collected by local authorities. This money, together with revenue from council tax payers, revenue support grant provided by the government and certain other sums is used to pay for local services.
From 1 April 2013, local authorities keep a proportion of the business rates paid locally which provides an incentive for them to work with local businesses to create a favourable local environment for growth.
You can find further information about the business rates system, including transitional and other reliefs on the GOV.UK website
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). The VOA draws up and maintains 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 1st April 2010, this date was set as 1st April 2008. All rateable values are calculated using this date so each assessment is considered fair.
The valuation officer may change the rateable value if circumstances change. The ratepayer and certain others who have an interest in the property can appeal against the rateable value shown in the list if they believe it is wrong. Full details on your rights of appeal are available from the Valuation Office Agency. We can only backdate any business rates rebate to the date from which the list is changed.
The Valuation Office Agency will alter rating assessments if new information comes to light indicating the valuation is inaccurate. Any alterations they make on or after 1st April 2016 can only be backdated to 1st April 2015.
Further information about the grounds on which appeals may be made and the process for doing so can be found on the VOA section of the GOV.UK website or from your local valuation office.
National non-domestic rating multiplier
We work 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.
The standard multiplier is higher to pay for the cost of small business rate relief, 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.
Business rates instalments
Payment of business rate bills is automatically set to 10-monthly instalments. However, you are able to make payments in 12-monthly instalments if you so wish. If you wish to do this you should contact us as soon as possible.
All rateable values are reassessed at a general revaluation to ensure that business rate bills reflect changes over time in the value of property relative to others. This helps maintain fairness in the rating system by updating valuations in line with changes in the property market.
The current rating list is based on the 2010 revaluation. The government has confirmed that the next revaluation will take place in 2017 based on rental values at 1st April 2015. More information on revaluation 2017
The multipliers will be recalculated in 2017 to account for overall changes to total rateable value and to ensure that the revaluation does not raise extra money for government.
Revaluations usually take place every five years. The change in the revaluation date to 2017 has no effect on the total amount of revenue raised from business rates.
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 certain industrial properties. After this period rates are payable in full unless the unoccupied property rate has been reduced by the government by order. If the unoccupied property rate for the financial year has been reduced by order, it will be shown on the front of your bill.
In most cases properties owned by charities and community amateur sports clubs do not have to pay business rates whilst they are empty. Details of all properties that are exempt from business rates whilst empty
The government has introduced a temporary measure for unoccupied new-builds from October 2013. Unoccupied new-builds will not have to pay business rates for up to 18 months (up to state aid limits) where the property comes on to the valuation list between 1st October 2013 and 30th September 2016. The 18-month period includes the initial 3 or 6 month exemption and so these properties may be exempt from business rates for up to an extra 15 or 12 months if unoccupied.
Partly occupied property relief
A ratepayer is liable for the full business rate bill whether a property is wholly occupied or only partly occupied. Where a property is partly occupied for a short time we can award relief in certain cases in respect of the unoccupied part. If this applies to you please contact us.
Small business rate relief
Subject to a small number of exemptions, ratepayers will have their bills calculated using the lower small business rates non-domestic rating multiplier, rather than the standard non-domestic rating multiplier if they:
- occupy a property with a rateable value which does not exceed £17,999 outside London or £25,499 in London, and
- are not entitled to other mandatory relief for the property, and
- are not entitled to an unoccupied exemption for the property.
In addition, small business rate relief can generally be given to ratepayers with a rateable value of less than £12,000 who occupy either-
(a) one property, or
(b) one main property and other additional properties providing those additional properties each have a rateable value which does not exceed £2,599.
The rateable value of the property mentioned in (a), or the aggregate rateable value of all the properties mentioned in (b), must not exceed £17,999 outside London or £25,499 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 stop from the day of the increase.
The government has announced, in the Autumn Statement 2015, that the doubling of the usual level of small business rate relief - to a maximum of 100% - will continue for a further year, until 31st March 2017. Therefore:
- If your 2010 rateable value is £6,000 or below, small business rate relief will be given at 100 per cent (doubled from 50 per cent).
- If your 2010 rateable value is between £6,001 and £11,999 inclusive, the small business rate multiplier is used and relief will be given on a sliding scale - from 100 per cent at the bottom of the range to 0 per cent at the top.
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.
An application for small business rate relief is not required. Where a ratepayer meets the eligibility criteria and has not received the relief they should contact us. 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.
A ratepayer who is in receipt of relief needs to notify us of the following changes in circumstances:
(a) the ratepayer taking up occupation of an additional property, and
(b) an increase in the rateable value of a property occupied by the ratepayer in an area other than our district area
Rate relief for businesses in rural areas
Certain types of properties in a rural settlement with a population below 3,000 may be entitled to relief. The property must be:
- occupied, and
- the only general store, the only post office or a food shop and have a rateable value of less than £8,500, or
- the only public house or the only petrol station and have a rateable value of less than £12,500.
An eligible ratepayer is entitled to relief at 50% of the full charge. We also have discretion to give further relief on the remaining bill. If this applies to you please contact us.
Charity and community amateur sports club relief
Charities and registered Community Amateur Sports Clubs are entitled to 80 per cent relief where the property is occupied by the charity or the club, and is wholly or mainly used for the charitable purposes of the charity (or of that and other charities), or for the purposes of the club (or of that and other clubs).
We have discretion to give further relief on the remaining bill. If this applies to you please contact us.
We have a general power to grant discretionary local discounts.
The award of such discounts is considered likely to amount to state aid. However it will be state aid compliant where it is provided in accordance with the De Minimis Regulations EC 1407/2013. The De Minimis Regulations allow an undertaking to receive up to EUR 200,000 'de minimis' aid over a rolling three year period. If you are receiving, or have received, any 'de minimis' aid granted during the current or two previous financial years (from any source), you should contact us immediately including details of the aid received.
We have discretion to give hardship relief in specific circumstances.
Ratepayers do not have to be represented in discussions about their rateable value or their rates bill. Appeals against rateable values can be made free of charge. However, ratepayers who do wish to be represented should be aware that members of the Royal Institution of Chartered Surveyors (RICS) and the Institute of Revenues, Rating and Valuation (IRRV) are qualified and are regulated by rules of professional conduct designed to protect the public from misconduct. Before you employ a rating adviser, you should check that they have the necessary knowledge and expertise, as well as appropriate indemnity insurance. Take great care and, if necessary, seek further advice before entering into any contract.
Information supplied with demand notices
Information relating to the relevant and previous financial years in regard to the gross expenditure of the local authority is available on the council tax pages.