Budget 2016 – Business Rates

Business Rates – Reductions Planned

The Chancellor has decided that the Small Business Rate Relief (SBRR) will be permanently doubled from 50% to 100% with effect from 1 April 2017. Moreover, the thresholds are being increased to benefit a greater number of businesses.

Businesses with a property that has a rateable value of £12,000 or less will receive 100% relief. Businesses with a property that has a rateable value between £12,000 and £15,000 will receive tapered relief. This means that 600,000 small businesses, occupiers of a third of all properties, will pay no business rates at all – a saving worth up to £5,900 in 2017-18. An additional 50,000 will benefit from tapered relief.

Additionally, the threshold for the standard business rates multiplier will be increased and only apply to those properties with a rateable value of over £51,000, taking 250,000 smaller properties out of the higher rate.

From April 2020, taxes for all businesses paying rates will be cut through a switch in the annual indexation of business rates from the RPI to be consistent with the main measure of inflation, currently the CPI, which is typically lower.  In 2020-21 alone it is estimated that this will be worth £370 million to businesses and the benefit will grow significantly thereafter.

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Jul 20

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