Qualifying for Small Business Rate Relief
12 January 2024

If you are a small business with a physical premises, you will be required to pay Small Business Rate – the commercial equivalent of council tax for your shop, office or catering location, whether you own it or are renting. The bill is charged to the occupier or leaseholder, and the money is used by your local council to find public services.
Some small businesses are entitled to small business rate relief, which is a reduction in the rate you are expected to pay. In some cases, a business may not have to pay anything. In this post, we give an overview of how this entitlement works.

Who qualifies for small business rate relief?

If you have a commercial property with a rateable value of £12,000 or less, you will not have to pay any business rates. Rateable value is granted by the Valuation Office Agency and is based on your yearly market rent. Your local authority uses this to calculate the business rate of your commercial property.

To find out if you are eligible for small business relief based on your individual circumstances, you can contact your local council, who can give you an exact amount.

How is it calculated?

If the rateable value of the property is between £12,001 and £15,000 your rate of relief will reduce gradually from 100% to 0%. If you have a rateable value of £13,500, your business rate will go down to 50%. If it’s £14,000, you are entitled to 33% reductions.

If you add another property to your business, you can continue claiming your current level of relief for the next year. To keep claiming after this period, your rateable value of your new properties isn’t any higher than £2899.

Each local council can calculate the exact entitlement of small businesses in the area. The rates and criteria for businesses vary in England, Scotland, Wales and Northern Ireland.

What are the different types of relief?

The types of small business rate relief available varies depending on the type of business, and how the commercial property is being used. These include:

– Retail, hospitality, and leisure relief
– Rural rate relief
– Charitable rate relief
– Local newspaper relief
– Empty property relief
– Transitional relief
– Hardship relief
– Freeports relief
– Heat networks relief

You will need to notify your local council of any changes to your circumstances. If your property becomes empty, you take on a new property, move to a new premises, or if you renovate, extend, or do anything to the building that increases its value. You normally will receive a changed rate from the first day your circumstances change.

How to apply

The first step to accessing small business rate relief is to contact your local council. They will help you calculate your eligibility and guide you through the application process.

You can also find out if you are entitled to any other relief in addition to small business rate relief.

Applications are normally completed online.

If you are looking for a new premises for your small business, Harlow business centre offers fully serviced office units at affordable prices. Click here to find out more.


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