Non-Domestic Rates

Overview

Non-domestic rates, also known as business rates are charged on properties such as; shops, offices, pubs, warehouses, factories, and holiday rental homes.

Billing

You will receive a bill in February or March each year from your local authority to cover the rates for the following year. If you have any queries about your bill you should get in touch with them. For questions concerning your rateable value, for example you think it may be wrong, you should contact the Valuation Office Agency (VOA).

Rateable value

“(in the UK) a value ascribed to a domestic or commercial building based on its size, location, and other factors, used to determine the rates payable by its owner”.

Non-domestic rates are worked out based on the rateable value of your property. You can make an estimate by multiplying the rateable value by the correct multiplier (this amount is set by the central government).

Revaluation

Normally every five years the VOA will adjust the rateable value of business properties.This is to reflect changes in the property market. The last revaluation was based on rateable values from 1st April 2015, and came into effect in England and Wales, (business rates differ in Scotland and Northern Ireland) on 1st April 2017.

To ensure your valuations are kept accurate, you should provide the VOA with up-to-date rental evidence for your property at revaluation.

At revaluation the VOA will provide all properties with a new rateable value and multipliers are revised, meaning that there will not always be a change in the bill.

Business rates relief

Please visit our information page Non-Domestic rates -Business rates relief for more detail,

If you are eligible you may be able to get a discount for your non-domestic rates from your local authority for the following:

  • Small business rate relief
  • Rural rate relief
  • Charitable rate relief
  • Enterprise zones
  • Exempted buildings and empty buildings relief
  • Hardship relief
  • Transitional relief
  • Retail discount

Changes to your business premises

If changes are not reported to the VOA you risk receiving a backdated increased bill. There is a chance that the amount of your rates could change if:

  • Your business premises move or you make changes to them
  • You start to sublet part of your premises
  • The nature of your business changes
  • You decide to merge two or more properties into one

It is possible to get a temporary reduction in the cost of your non-domestic rates, for example if you are affected by a local disruption, such as flooding or roadworks.

Home working

For some home based businesses you don’t normally have to pay non-domestic rates in addition to your council tax. For example:

  • Where you are selling goods by post
  • Only a small part of your home is used for business purposes, such as a bedroom that you use as an office

In addition to paying council tax you may be charged non-domestic rates as well for your business, for example:

  • Where you are selling goods or services to people that visit your property
  • Your property may be part business and part domestic, such as, you live above a shop
  • Other people are employed to work at your property
  • You have made changes to your home for business purposes. For example you may have converted your garage into a hair salon

If you are unsure if you should be paying non-domestic rates you should contact the VOA.

Pubs and licensed trade

The VOA (in England and Wales) calculates your rateable value based on the annual level of trade (excluding VAT) that a pub is expected to achieve if operated in a reasonably efficient way. This is known as a ‘fair maintainable trade’ based on; the type of pub or licensed premises it is, the location and the services the business offers, such as food, gaming, or sports screening.

The VOA will also work out the fair maintainable trade figure by looking at rents and turnovers and applies a percentage to work out the rateable value. The percentages are agreed with the British Beer and Pub Association and they’re in the VOA’s pub guide visit www.gov.uk/government/publications/valuation-of-public-houses

You will need to provide the VOA with details of your turnover (excluding VAT) from all sources, for example food, liquor and gaming.

Self-catering and holiday lets

You may be eligible for small business rate relief if you only have one property that you let out and it’s rateable value is less than £15,000.00.

England

For properties that are available to let in England, for short periods of 140 days or more per year, they will be rated as self catering properties and valued for business rates.

Wales

For properties in Wales they will be valued for business rates and rated as a self catering property provided that; they are available to let for short periods of 140 days or more per year and they are actually let for 70 days.

The VOA will calculate the rateable value of your property based on its type, size, location, quality and the likely income you will receive from letting it.

Contacts

Valuation Office Agency

www.gov.uk/contact-voa

T (England): 03000 501 501

T (Wales): 03000 505 505


Gov.uk

www.gov.uk/find-local-council

(Local Authority finder)