The following applies to ENGLAND only as the devolved governments in Scotland, Wales and Northern Ireland have their own schemes.
Business Rates Multiplier
As in previous years there is a freeze in the Small Business Multiplier, so it remains at 49.9 pence in the £. The “standard” multiplier has, however, increased and for properties with a rateable value of more that £51,000 will be 54.6 pence in £. That will present a sizeable increase for many businesses on its own but those businesses “benefitting” from transitional relief (see below) will see a further increase in their liabilities.
Fortunately, a technical change has meant that the rate charged on both empty properties and those occupied by charities with a rateable value of less than £51,000 will see the multiplier charged at 49.9 pence in £ in line with “mainstream” ratepayers.
Different multipliers apply in the City of London.
Transitional Relief
We are now entering the second year of transitional relief; the mechanism whereby businesses that are faced with large increases in their business rates as a consequence of the revaluation of property that came into effect from 1st April 2023.
In year one (2023/24) increases were limited as follows:
Rateable value
Up to £20,000 (£28,000 in London)
£20,001 (£28,001 in London) to £100,000
Over £100,000
2023 to 2024
5%
15%
30%
In 2024/25 these limits are now:
Rateable value
Up to £20,000 (£28,000 in London)
£20,001 (£28,001 in London) to £100,000
Over £100,000
2024 to 2025
10%
25%
40%
The result is that for those businesses that have seen an increase in the rateable value of their property (for example some distribution centres and warehouses) will notice an above inflation increase in the amount that they will be required to pay.
Retail Relief
Retail Relief has been extended for a further year with a discount of 75% for eligible properties in the Retail Hospitality & Leisure sectors.
This, however, comes with conditions.
There is a cap on the amount of relief that a business can receive at £110,000 per annum. This will apply at group level so businesses that may be subsidiaries will be limited to £110,000 per annum per holding company.
In addition, Subsidy Controls limit this further so that a business will not be able to receive in excess of £315,000 by way of subsidy over a three-year period so, for example a business that has received £110,000 in Retail Relief in each of the past two years will see the amount of relief limited in 2024/25 to £95,000.
Small Business Rate Relief (SBRR)
The current rateable value threshold for SBRR remains at £12,000. Ratepayers occupying a single property with a rateable value of £12,000 or less will see a relief of 100%. Properties with a rateable value of £12,001 to £15,000 will get a reduced level of support.
Business Rates Improvement Relief
This relief already exists in Scotland and will be introduced in England from April 2024. The impact of this relief will be that any new improvement to a property will not see an increase in business rates for 12 months. This relief will be available unit 2028 when it will be reviewed.
Flood Relief
Whilst this was not specifically mentioned in the Autumn Statement, it has become more relevant since then, particularly with the impact of Storms Babet and Henk either side of Christmas and New Year.
Relief of 100% for a three-month period can be granted to a business that was affected by flooding in the aftermath of these storms, but it is worth noting that this is reliant on the particular billing authority being in a designated area, which is one that has more than 50 properties are affected by flooding.
How Colliers and Accurates can help
The increase in the multiplier is as a consequence of the inflation rate in September 2023 which was 6.7%. Although we have seen a reduction in inflation since (January 2024 was reported at 4.2%) this has not affected the multiplier, so businesses should ensure that they are not paying over the odds. The Rating Team at Colliers can ensure that a ratepayer’s rateable value is correct and take the appropriate action if necessary.
In some cases now, businesses are effectively paying in excess of an additional 50% of their rent in business rates making it one of the most expensive costs a business has to cover and increasing the importance of checking that any liability is a correct one.
Over the years Colliers and Accurates have a proven track records of saving clients millions of pounds by way of business rates ensuring that these clients pay a fair contribution to the local economies in which they are based.
Author:
Richard Sheppard
Head of Accurates
