What is small business rates relief?

Has your small business suffered as a result of Covid-19? The new small business rates relief scheme could save you up to £110,000 per year! Here’s how.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.

Image source: Getty Images

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! 

5 Stocks For Trying To Build Wealth After 50

One notable billionaire made 99% of his current wealth after his 50th birthday. And here at The Motley Fool, we believe it is NEVER too late to start trying to build your fortune in the stock market. Our expert Motley Fool analyst team have shortlisted 5 companies that they believe could be a great fit for investors aged 50+ trying to build long-term, diversified portfolios.

Click here to claim your free copy now!

[top_pitch]

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 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.
[middle_pitch]

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.

Is this little-known company the next ‘Monster’ IPO?

Right now, this ‘screaming BUY’ stock is trading at a steep discount from its IPO price, but it looks like the sky is the limit in the years ahead.

Because this North American company is the clear leader in its field which is estimated to be worth US$261 BILLION by 2025.

The Motley Fool UK analyst team has just published a comprehensive report that shows you exactly why we believe it has so much upside potential.

But I warn you, you’ll need to act quickly, given how fast this ‘Monster IPO’ is already moving.

Click here to see how you can get a copy of this report for yourself today

More on Personal Finance

Note paper with question mark on orange background
Personal Finance

Should you invest your ISA in a model portfolio?

Which model ISA portfolios offer both high performance and low fees? Hargreaves Lansdown, Interactive Investor and AJ Bell go under…

Read more »

Economic Uncertainty Ahead Sign With Stormy Background
Personal Finance

Is it time to exit emerging markets investments?

Investors may well be sitting on losses from emerging markets funds. Is it worth keeping the faith for a sustained…

Read more »

Personal Finance

Share trading? Three shares with turnaround potential

Share trading has been difficult in 2022, but which companies have turnaround potential? Jo Groves takes a closer look at…

Read more »

Man using credit card and smartphone for purchasing goods online.
Personal Finance

Revealed! Why Gen Z may be the savviest generation when it comes to credit cards

New research reveals that Gen Z may be the most astute when it comes to credit cards. But why? And…

Read more »

Environmental technology concept.
Personal Finance

The 10 best-performing sectors for ISA investors

The best-performing sectors over the past year invested in real assets such as infrastructure, but is this trend set to…

Read more »

Road sign warning of a risk ahead
Personal Finance

Recession risk ‘on the rise’: is it time for investors to worry?

A major global bank has suggested the risk of a recession in the UK is 'on the rise'. So, should…

Read more »

pensive bearded business man sitting on chair looking out of the window
Personal Finance

1 in 4 cutting back on investments amid cost of living crisis

New research shows one in four investors have cut back on their investing contributions to cope with the rising cost…

Read more »

Image of person checking their shares portfolio on mobile phone and computer
Personal Finance

The 10 most popular stocks among UK investors so far this year

As the new tax year kicks off, here's a look at some of the most popular stocks among UK investors…

Read more »