What are Business Rates / FAQs
Business Rates, known formally as National Non-Domestic Rates ( NNDR ), are a form of tax charged on non domestic properties to help pay for services in the local area.
With some exceptions, if you run a business such as a shop, office, warehouse or factory, then it is very likely that you will have to pay business rates.
Who Sets Business Rates
Business rates are set by central Government which then allocates the money raised to councils across the country according to the number of people living in the area. Our share of this money, together with the money we collect from domestic Council Tax, pays for the services we provide.
Who has to pay Business Rates?
The occupier of a non-domestic property normally pays business rates. Usually this is the owner-occupier or leaseholder. This can be one person, a partnership, a limited company, a club or some other organisation.
If you lease a property from a landlord, but keep it empty, you are still liable for empty property rates. This is because the lease entitles you, rather than your landlord, to occupy the property.
HOW DO I PAY MY BUSINESS RATES
Installments
You can pay your Business Rates in three ways:
- Yearly (in which case payment must be made by the 1st April)
- Half-yearly (in which case payment must be made by the 1st April and the 1st September
- In 10 instalments from April to January (instalments are due on the 1st of each month)
Payment Channels
Payments can be made by:
- direct debit
- via the internet
- phone
- post
- at post offices and other All Pay locations
- in person
For more information on ways to pay, please see our payments information.
To pay NNDR online now using your debit or credit card.
How are business rates worked out?
The Valuation Office, which is part of HM Revenue and Customs Service, is responsible for setting the ‘rateable value’ of your property. This is reviewed every five years and provides the base figure for calculating your rates.
Every year the Government then calculates how much it wishes to raise in tax from businesses and sets a figure known as the ‘multiplier’. Your annual business rate figure is the rateable value of your property multiplied by the annual multiplier figure.
Because bigger and more valuable properties have higher rateable values than smaller and less valuable properties, they pay a higher share of the business rates.
The purpose of the revaluation every five years is not to raise extra revenue overall but to ensure that rateable values are based upon up-to-date rental values. Rateable values and therefore rate bills for some properties may rise or fall as a result. Following the 2010 revaluation, special transitional arrangements were put in place to phase in significant increases or decreases in rates bills over the next five years and these set limits on the percentage by which your rates liability can change each year.
You can find more information about transitional arrangements from the Business Link website.
Rateable Values
The rateable value of your property is shown on the front of your bill. The value broadly represents the yearly rent that the property could have been let for on the open market on a particular date. For the revaluation that came into effect on 1st April 2010, this date was set as 1st April 2008. The next general revaluation will take effect from 1 April 2015.
The Valuation Office maintains a full list of all rateable values on their website to enable you to check the rateable value of your property and compare it with others. If the circumstances of your property have changed or you believe the figure is incorrect, you can appeal against the figure shown on the list. Full information on how to do this is given on the Valuation Office website.
The effect of successful appeals against values shown in the rating list that came into force on 1st April 2010 will normally be backdated to the beginning of the financial year in which they are made, although there are exceptions to this. Again, further information may be obtained from the Valuation Office website.
The Multiplier
The local Council works out the Business Rates bill by multiplying the rateable value of the property by the multiplier which the Government sets. There are two multipliers, the standard non-domestic rating multiplier and the small business non-domestic rating multiplier. The standard non-domestic rating multiplier is higher to pay for small business rate relief.
The Government sets the multipliers for each financial year for the whole of England. The Government normally changes both multipliers every year to move in line with inflation. By law, the multipliers cannot go up by more than the rate of inflation apart from some minor adjustments to counteract losses from appeals and, in relation to the standard multiplier, to pay for small business rate relief.
In the year of a revaluation the multiplier 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.
The current multipliers are shown on the front of your bill and should be as shown below.
| Year | Small Business | Standard Rate |
| 2010-2011 | 40.7p | 41.4p |
| 2009-2010 | 48.1p | 48.5p |
| 2008-2009 | 45.8p | 46.2p |
| 2007-2008 | 44.1p | 44.4p |
| 2006-2007 | 42.6p | 43.3p |
| 2005-2006 | 41.5p | 42.2p |
Will I be charged for Business Rates if I work from home?
If you work from home, we will only charge Business Rates for the part of the property used for work. If the space you use is minimal it may not be subject to business rates but you should still contact us to make sure, particularly since you may be entitled to small business rate relief or other exemption.
Please note that you will have to pay Council tax for the rest of the property. You may however be entitled to a change in your Council valuation band depending how much of your home is used for work. You can contact the HM Customs and Excise Valuation Office for advice on this as the Valuation Office.
What if I offer bed and breakfast accommodation or hire out a holiday home?
If you offer B&B in your own home to six people or fewer, you will not have to pay business rates as long as you also live there. You will however have to pay domestic council tax.
If you hire out your holiday home for more than 140 days a year or you provide B&B for more than six people at any one time, you will have to pay business rates on that part of the property. You will also have to pay council tax on the part of your property you use as your home.