You will be eligible for small business rate relief in England if your rateable value is below £18,000 (£25,500 in London):
- If your 2010 rateable value is £6,000 or below, the small business rate multiplier is used and the bill will be reduced by 50 per cent.
- If your 2010 rateable value is between £6,001 and £11,999 inclusive, the small business rate multiplier is used and the bill will be reduced on a sliding scale – from 50 per cent at the bottom of the range to 0 per cent at the top. For example, if the rateable value is £9,000, the bill will be reduced by 25 per cent.
- If your 2010 rateable value is between £12,000 and £17,999 (£25,499 in London), the small business rate multiplier is used only.
Between 1 October 2010 and 31 March 2013, eligible ratepayers will receive small business rate relief at 100 per cent on properties up to £6,000 (rather than 50 per cent), and a tapering relief from 100 per cent to 0 per cent for properties up to £12,000 in rateable value for that period.
The temporary Small Business Rate Relief increase will therefore apply throughout the whole of the 2012-13 billing year (until 31 March 2013). The relief was originally doubled by the government until September 2011, but this was extended by the Budget in March 2011, and then extended again in the 2011 Autumn Statement to take account of economic conditions.
If you have more than one business property, the relief is only available if the rateable value of each of the other properties is below £2,600. If this is the case, the rateable values of all the properties will be combined and the relief is applied to the main property based on the total rateable value.
You will be exempt from paying business rates on an empty property for three months after the property becomes vacant.
There are additional exemptions for certain types of property or for properties under a set rateable value:
- industrial premises, such as warehouses, are exempt for a further three months
- listed buildings are exempt until they become occupied again
- buildings with a rateable value under £2,600 are exempt until they become occupied again
- properties owned by charities are exempt if the property’s next use is likely to be wholly or mainly for charitable purposes
- community amateur sports club buildings are exempt if their next use is likely to be wholly or mainly for a sport club
After the exemption period ends, you will be liable for the full business rate bill.
Rural Rate Relief
The rural rate relief scheme was introduced to help protect the last retail outlets and similar services in rural settlements with a population of less than 3,000.
Under the scheme, the following businesses in designated rural settlements are entitled to 50 per cent mandatory rate relief:
- the sole village shop or post office with a rateable value of up to £8,500
- the sole public house or petrol station with a rateable value of up to £12,500
Local authorities have a discretionary power to top up the mandatory relief to 100 per cent. They can also, if they wish, provide discretionary relief up to 100 per cent to other rural retail facilities, providing the rateable value is below £16,500.
Charitable Rate Relief
Charitable relief is administered by your local authority. You should contact them to check your eligibility and apply for the relief.
Charities and amateur community sports clubs can apply for charitable relief if the property is used for charitable purposes. This can reduce the bill by 80 per cent. In some areas this could be reduced even further through additional discretionary relief.