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Small Business Rates Relief

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Employment Law

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Debt chasing

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Small Business Rates Relief is a relief from business rates which means that subject to completing an application form small business do not have to pay business rates (or have to pay a reduced amount). The relief is paid for by charging large business slightly more and the net cost to the tax payer is nil. The benefit to a small business can be substantial.

On 2nd March 2015 the The Non-Domestic Rating (Small Business Rate Relief) (England) (Amendment) Order 2015 came into force. We have not seen any publicity for it and to date council and .gov websites have not been updated and as usual the awareness of this relief for small businesses will probably remain low. This order extends the relief period until the end of March 2016.

A small business with a single premises and business rates of less than £12,000 can obtain relief subject to completing an application form (and meeting the conditions). 100% relief is available if the rateable value is under £6000 (i.e. no rates are payable). Councils are still known to issue liability orders to enforce payment of business rates that are not due (for want of the application form) and historically have not been quick to publicise the availability or existence of this relief. A conservative initiative the Small Business Rate Relief (Automatic Payment) Bill was not adopted, but sought to ensure as the name suggests that the relief was automatically applied to eligible businesses (councils already have all the information to calculate which companies are eligible).Parliamentary discussions illustrated that around £400 million of this relief was unclaimed because few know about it – even my accountants didn’t know it existed!  This automatic payment bill if passed would have made application of the relief by councils automatic, which could well have been far cheaper for councils (who would not have to process forms), and offer the support small businesses need, and significant savings.

It is a great shame and injustice that the automatic payment bill was not passed but good news for small business that the relief program has been extended for another year. Spread the word.

How to obtain this relief. Applicants need to obtain a form usually from their local council which is usually short and simple to complete. It should take less than an hour to complete and should be delivered or posted to the council that collects your non domestic rates – that’s the official name for business rates. I always recommend recorded delivery with councils who have a habit of losing mail!