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Introduction to Business Rates

What are business rates?

Non-domestic rates or business rates are the way that those who occupy non-domestic property contribute towards the cost of local services. They are administered and collected by local authorities.

Under the business rates retention arrangements introduced in April 2013, authorities keep a proportion of the business rates paid locally. This provides a direct financial incentive for authorities to work with local businesses to create a favourable local environment for growth since authorities will benefit from growth in business rates revenues. The money, together with revenue from council tax payers, revenue support grant provided by the government and certain other sums, is used to pay for the services provided by your local authority and other local authorities in your area

 For further information  download our explanatory notes for business rates financial year 2016/2017

 Who has to pay?

In most circumstances occupiers of properties that are entered in the Valuation Office Agency’s (VOA) business rates lists are liable to pay.  Business rates are charged on most non-domestic properties such as shops, offices, pubs, warehouses, factories, holiday rental homes or guest houses.

 If the non-domestic property is empty liability will fall to the owner/leaseholder/freeholder and in most cases a charge is due

How are they calculated?

The rateable value of your business premises is set by the Valuation Office Agency (VOA). This is based on their assessment of the open market rental value. The VOA provide a facility to check the rateable value of your property online.

The amount of business rates payable is calculated by multiplying the rateable value by the correct ‘multiplier’ (an amount set by the government) and then awarding any relevant reliefs & reductions. The current multipliers are shown on the front of your bill.

 Before the start of each financial year the government sets two multipliers for the whole of England; the standard rating multiplier and the small business multiplier.