Business Rates Explained

Understanding Business Rates

Business rates are local taxes, similar to council tax for residential properties, but they apply to non-domestic or business properties.

These rates are applicable to various types of business properties, including 

• Shops
• Offices
• Pubs
• Warehouses
• Factories
• Holiday rental homes or guest houses

Importantly, the property doesn't necessarily have to be used for business purposes. You'll receive an annual business rates bill.

Roles and Responsibilities

The Valuation Office Agency determines the value of business premises based on property details, including rental information.

Rateable Value

The rateable value is assessed by the Valuation Office Agency, an agency of HM Revenue and Customs. It represents the hypothetical annual rent a property would fetch on the open market as of April 1, 2021.

If you believe your rateable value is incorrect, you can check and update your property details on the GOV.UK website. If discrepancies exist, follow the instructions provided to:

• CHECK, review and confirm the facts about your property held by the VOA
• CHALLENGE, once the facts are established, explain why you believe your valuation is wrong

The Valuation Office Agency periodically revalues and updates rateable values, typically every five years. This process is known as Revaluation and doesn't increase overall tax revenue.

Non-Domestic Rates

If you're using a property, you must pay non-domestic rates. If you're part of an inclusive rent and rates payment arrangement with your landlord, but the Council doesn't receive the payment, they will take recovery action against you.

Legal enforcement cannot be applied against the property owner or landlord in such cases, regardless of lease terms.

Payment Options Instalments

• Business rates for a full year can be paid in ten instalments from April to January.
• Alternatively, businesses can choose to pay in twelve monthly instalments.
• Bills issued mid-year consider a reduced amount, 
• Bills issued towards the end of the financial year must be paid in a single payment.
• All instalments are due by the specified date.

Missed Payments

If you miss a payment or it's late, you'll receive a reminder notice to catch up. If you do this within the given time frame, you can continue with the instalment plan, but you may not receive further reminders.

Failure to bring the account up-to-date means you'll lose the right to pay in instalments, and a summons will be issued for the entire year's debt.

Liability Order

If the amount isn't paid in full or a suitable payment arrangement isn't made, a liability order will be sought in the Magistrates Court. Unless the full amount is paid or a payment arrangement is agreed upon, a certified bailiff will be instructed to recover the owed amount, or insolvency proceedings will commence.

If you can't meet your business rates obligations, contact us immediately for assistance.

Explanatory Notes

Each year central government issues explanatory notes for the benefit of ratepayers which billing authorities are required to publish on their website.  Please see Word document

• Explanatory Notes 2023 to 2024

Find out more

For more information on the Revaluation, rateable values, and business rates

• Visit  Business rates: Overview - GOV.UK (www.gov.uk)
• Visit  Find a business rates valuation - GOV.UK (www.gov.uk)