The last two years have been difficult for small business owners who have been hit hard by the pandemic. Retail and leisure businesses have suffered the most, with a surge in online spending and a reduction in holidays due to Covid-19 restrictions. As a result, the government has introduced a small business rates relief scheme.
The scheme could see small businesses across the UK save up to £110,000. Here’s everything you need to know and how you can apply!
What is the small business rates relief scheme?
In the October 2021 Budget, the government introduced a new scheme that is aimed towards helping small businesses get back on their feet after the pandemic. The Retail, Hospitality and Leisure Rates Relief Scheme will provide small businesses with the funds that they need to meet consumer demand and adapt to change.
The scheme comes as part of a plan to keep our high streets busy in a time when online shopping is on the rise and is worth almost £1.7 billion. It will be used by local authorities to support small businesses in their areas.
What are business rates?
Business rates are charged to non-domestic properties in the UK. Therefore, small business owners are required to pay these rates for any buildings that are used for business. If you own a shop, office space or warehouse, then you have to pay business rates.
Business rates are collected by local authorities, who send you a letter in February or March each year. The exact amount that you pay depends on the property’s rateable value, which is confirmed by the Valuation Office Agency each year. For every pound of rateable value, small businesses are required to pay 49.9 pence in rates.
How can business rates relief help my small business?
During the pandemic, many small businesses have struggled to stay on top of financial demands. As a result, the government has introduced a relief scheme that could significantly cut down your business rates bill.
In the year 22/23, retail, hospitality and leisure businesses could receive up to 50% off of their business rates bill. However, the government has set a cash cap limit of up to £110,000 per business. Further details should be provided to small businesses by their local authorities at the beginning of the billing cycle.
Who is eligible for small business rates relief?
The 2022/23 rates relief scheme is available to small businesses that operate in the retail, hospitality or leisure sectors. As a result, any businesses that don’t fit into these industries will not be able to apply.
The exact details of eligible businesses have not been published by the government. However, small businesses that are able to apply will receive a letter from their local council at the beginning of the billing cycle.
How to apply for the business rates relief scheme
If you meet the criteria for the 2022/23 business rates relief scheme, then you will be notified by your local council. Your rate should then be automatically reduced and your new bill should be lower than in previous years.
If you believe that your bill is incorrect, then you can contact your local authority to discuss your business rates relief eligibility.
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About the author
Ruby is a freelance writer who enjoys writing about all things personal finance. After embarking on her own side hustle journey three years ago, Ruby is passionate about helping others to learn about the ins and outs of persona… Read More
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