Are you benefiting from the new Business rates?

If you are a small business in England, you now should be enjoying 33% off your business rates bills (as announced by Phillip Hammond's in his Autumn Budget last year). The powers to pay the discount have been given over to local councils; however, some have not been issuing this discount automatically.

Benefiting business rates in Harrow

What is the Retail Discount Scheme?

The Government has now recognised that changing consumer behaviour presents a huge challenge for retailers in our town centres, and is taking this action to help the high street evolve and survive.

Starting from April 2019, it applies to occupied retail properties with a rateable value of less than £51,000, and applies if you own a business that is being used as a shop to either selling goods, or provides a service (like a restaurant, café or pub) for the next two years (2019/20 and 2020/21).

Who is legible for the discount

Here is just a small selection of some of the retailers that would be able to apply for the discount:

  • Shops (such as: florists, bakers, butchers, jewellers, off licences, chemists, newsagents, hardware stores)
  • Opticians
  • Post offices
  • Car/ caravan show rooms
  • Garden centres
  • Art galleries (where art is for sale/hire)

The discount is one-third of the rates bill after deducting other reliefs such as small business rate relief. Therefore, there will be no discount if 100% small business rate relief is available.

Who isn't legible?

Each local council will decide and administer (using Government guidelines), which properties are eligible or ineligible, so the exact definition will differ around the country. The services below, however, are not legible to receive the discount:

  • Financial services (such as bureau de change, payday lenders, betting shops and pawn brokers);
  • Estate agents and employment agencies;
  • Vets, dentists, doctors, osteopaths and chiropractors;
  • Solicitors, insurance agents, financial advisers and tutors.

Quick Example – what your reduced bill may look like

The rates bill for a shop with a rateable value of £13,500 and eligible for small business rate relief of 50% will be £2,210, based on the three following calculations:

  • Normal rates of £6,629 (£13,500 x 0.491) less
  • Small business rate relief of £3,314 (£6,629 x 50%) and
  • The one-third discount of £1,105 ((£6,629 - £3,314) x 1/3)).
  • Therefore the total would be: £6,629 - £3314 - £1105 = £2210

The Government has published quite an extensive guide which was been written mainly for councils but you it might be useful to read or download

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