Business rates are a headache for many small businesses, especially since the controversial 2017 revaluation.
If you have business property, or, in some cases, if you work from home, you need to understand business rates and how much you might pay.
Download your free in-depth guide to business rates and how much you need to pay. Get instant access to expert hints and tips in the click of a few buttons.
Business rates are a tax on property used for business purposes. They are charged on properties such as offices, shops, pubs, and warehouses – most non-domestic properties will attract business rates. They may also be charged where only part of a building is used for non-domestic purposes.
Business rates are calculated based on a property’s ‘rateable value’. The rateable value is a property’s estimated value on the open market. The last revaluation, conducted by the Valuation Office Agency (VOA) and which came into effect on 1 April 2017, refers to values as of 1 April 2015.
It is possible to estimate your business rates by multiplying your property’s rateable value by the relevant number. You can read more below.
It’s not uncommon for business rates payers to believe that their rateable value is incorrect. If this is the case, then the business rates you are required to pay will be calculated wrongly.
First, you should check the VOA’s rateable value for your property. You may also wish to compare it with other similar properties in your area. If you still suspect that the rateable value is incorrect, you can then apply to have it changed.
You can check and apply to revise your rateable value using this government tool.
There are a range of reliefs available for some properties. The most useful of these to small firms is the small business rate relief. This is available if your property has a rateable value of less than £15,000, and generally if your business only uses one property.
Full relief is available on properties with a rateable value of £12,000 or less. For those between £12,001 and £15,000, relief ratchets down gradually from 100 per cent to zero per cent.
If your property no longer qualifies for relief as a result of the 2017 revaluation, there are caps on the amount you will pay. Your bill will not increase by more than £50 a month until 31 March 2018.
There are other business rates reliefs available, including the rural rate relief and charitable rate relief. You can read more about these on gov.uk.
If you use a small part of your home for business purposes, you will not generally have to pay business rates. However, there are circumstances in which you will have to pay business rates, in addition to Council Tax. For example:
If you’re in doubt as to whether or not you should be paying business rates, you should contact the Valuation Office Agency.
It’s possible to estimate your business rates bill. In order to do this, you need to find out your property’s rateable value, which you can do here.
You’ll then need to find the correct multiplier, which will depend on the rateable value. Then, deduct any reliefs to which you are entitled.
You can use the government’s business rates calculator here.
3 April 2017 • 2-minute read
Simply Business data has revealed the potential impact of the business rates rise to UK small businesses - with Milton Keynes and Reading…
23 February 2017 • 2-minute read
Businesses across England and Wales will see their business rates bills change drastically thanks to a new revaluation. The change has been…
6th Floor99 Gresham StreetLondonEC2V 7NG
Sol House29 St Katherine's StreetNorthamptonNN1 2QZ
© Copyright 2020 Simply Business. All Rights Reserved. Simply Business is a trading name of Xbridge Limited which is authorised and regulated by the Financial Conduct Authority (Financial Services Registration No: 313348). Xbridge Limited (No: 3967717) has its registered office at 6th Floor, 99 Gresham Street, London, EC2V 7NG.