Calculating your business rates
Your rates bill is calculated by applying a multiplier to the rateable value of the premises.
The rateable value is set by the Valuation Office Agency (VOA) and it is shown on your bill. The VOA draw up and maintain a full list of all rateable values, please view on:
The rateable value or your property broadly represents the yearly rent the property could have been let for on the open market on a particular date. The latest valuation comes in to effect on 1st April 2017 and uses information taken on 1st April 2015.
The valuation office may alter the value if circumstances change. 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.
To make an appeal against your rateable value you do not have to be represented by a rating adviser. If you wish to be represented, take great care when appointing a rating advisor. Check that they are knowledgeable and experienced and have appropriate indemnity insurance. Members of the following institutes are qualified and regulated by rules of professional conduct:
- Royal Institution of Chartered Surveyors (RICS) and
- the Institute of Revenues Rating and Valuation (IRRV)
Appealing your 2017 rateable value
From April 2017 the Valuation Office Agency introduced a new process for business rates appeals called Check, Challenge, Appeal.
- If you have reason to believe that your 2017 rateable value is not correct, visit and follow the instructions on the VOA website how to check and challenge your rateable value.
You cannot appeal your 2017 rateable value until you have completed the Check and Challenge stages.
Multipliers for the rateable value
There are two multipliers which are set by the Government from 1 April each year. Your business rates bill is calculated by applying the appropriate multiplier to the rateable value.
For the year starting 1 April 2020 the multipliers are:
- 0.512 is the standard multiplier used for rateable values of £51,000 and above
- 0.499 is the small business multiplier used for most rateable values of £50,999 or less
The Government normally changes the multiplier every year to move in line with inflation. By law, the multiplier cannot go up by more than the rate of inflation, except in the year of a revaluation when it is set at a level which will keep the total amount raised in rates after the revaluation the same as before, plus inflation for that year.
Transition scheme 2017
For those ratepayers who would otherwise have seen significant increases in their rates liability, the Government put in place a £3.6 billion scheme to limit and phase in changes in rate bills as a result of the 2017 revaluation. To help pay for the limits on increases in bills, there were also limits on reductions in bills.
Under the transition scheme, limits continue to apply to yearly increases and decreases until the full amount is due.
The scheme applies only to the bill based on a property at the time of the revaluation. If there are any changes to the property after 1 April 2017, transitional arrangements will not normally apply.
The transitional arrangements are applied automatically and are shown on your bill. For more information on transitional relief please:
- visit the Gov.uk website
Small Business rate relief from 2017
A new small business rate relief scheme came into effect on 1 April 2017. Many businesses with rateable values below £12,000 will pay nothing. Those with rateable values between £12,001 and £14,999 will receive relief on a sliding scale and most of those with RV’s below £51,000 will benefit from having their charge calculated using the small business rate multiplier.
Examples of calculations
- RV x small business multiplier £19,000 x 0.499 = £9,481.00 rates payable
- RV x standard multiplier £55,000 x 0.512 = £28,160.00 rates payable
Small business rate relief:
- RV x small business multiplier £14,000 x 0.499 = £6,986.00 payable before relief
- Small business rate relief on a sliding scale £4,658.00 rates payable and £2,328.00 relief