Business rates relief: extensions and cuts

12 Jan 2024

November's Autumn Statement included a package of measures to help alleviate the burden of business rates in England and on the Scottish islands, but Wales won't be so fortunate.

75% relief rules

Retail, hospitality and leisure properties that do not qualify for small business rates relief currently receive a 75% business rates discount, subject to a cap of £110,000 for each business. This relief is to continue throughout 2024/25.

Property will typically qualify for relief if the business is mainly being used as a:

• Shop;
• Restaurant, café, bar or pub;
• Cinema or music venue; or
• Gym, spa or hotel.

There is an equivalent scheme for Welsh retail, hospitality and leisure property, but for 2024/25 the discount has been reduced to 40%. There is no equivalent relief for Scottish or Northern Irish business property. However, Scotland has announced a new 100% relief for hospitality businesses situated on the Scottish islands.

Multipliers

A business rates bill consists of a property's rateable value multiplied by a multiplier (or poundage). For 2024/25, the small business multiplier (rateable value below £51,000) is again frozen at 49.9p. However, the standard multiplier (rateable value over £51,000 or more) is being uprated by 6.7% to 54.6p.

Given inflation has now dropped to 3.9% (November 2023), the 6.7% increase for the standard multiplier is not going to be favourably received.

• Scotland: The basic multiplier has been frozen, but higher value properties will see poundage increased by 6.7%.
• Wales: The multiplier will see an across-the-board increase of 5%. This will be painful for smaller businesses, especially as the Welsh multiplier at 56.2p is the highest in the UK.
• Northern Ireland: No announcement as yet, and, in any case, rate poundage varies across council areas.

To summarise the various outcomes:

Details of the various business rates reliefs available in England can be found here.