An explanation of business rates, how they're calculated and how the rateable value of your property is set.
Business rates are charged on most non-domestic properties, such as shops, offices and factories. Business rates are collected by local authorities. They are used to contribute towards the cost of local services.
Under the business rates retention arrangements introduced from 1 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.
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 local authorities in your area.
Apart from properties that are exempt from business rates, each non-domestic property has a rateable value which is set by the valuation officers of the Valuation Office Agency (VOA), an agency of Her Majesty's Revenue and Customs. They draw up and maintain a full list of all rateable values, available on Valuation Office Agency webpages on the Government website (external link).
The rateable value of your property is shown on the front of your bill.
The rateable value broadly represents the yearly rent the property could have been let for on the open market on a particular date. For the revaluation that came into effect on 1 April 2023, this date was set as 1 April 2021.
If your circumstances change, the valuation officer may alter the value. The ratepayer (and certain others who have an interest in the property) can appeal against the value shown in the list if they believe it is wrong. Full details on your rights of appeal are available from the Valuation Office Agency. Your billing authority can only backdate any business rates rebate to the date from which any change to the list is to have effect.
As part of the Autumn 2022 Statement, the Chancellor has confirmed:
Ratepayers can view their future rateable values and get an estimate of what their business rates bill might be (from 1 April 2023) through the find a business rates valuation on the Government website (external link).
Payment of business rate bills is automatically set on a 10-monthly cycle. However, the government has put in place regulations that will allow businesses to require their local authority to enable payments to be made through 12 monthly instalments. If you wish to take up this offer, you should contact your local authority as soon as possible.