When it comes to running a business, there are a multitude of expenses that business owners have to consider One such expense is the national non-domestic business rates, also known as business rates These rates are essentially a tax on the commercial property that a business occupies.
The national non-domestic business rates are set by the government and are used to fund local services such as police, fire, and education The amount a business has to pay in business rates is determined by the rateable value of the property it occupies This rateable value is assessed by the Valuation Office Agency (VOA) and is based on the open market rental value of the property.
Business rates can be a significant cost for businesses, especially for those located in prime locations with high rateable values However, there are ways in which businesses can reduce the amount they have to pay in business rates For example, businesses that occupy small properties with a rateable value of less than £12,000 are eligible for small business rate relief, which can lead to a significant reduction in their business rates bill.
Additionally, businesses located in certain designated areas, such as enterprise zones, may also be eligible for business rates relief or discounts It is important for business owners to check with their local council to see if they qualify for any business rates relief schemes.
Business rates are typically revalued every five years to reflect changes in the property market national non domestic business rates. The most recent revaluation took place in 2017, which led to significant increases in business rates bills for many businesses, particularly those located in high-value areas such as London.
Business rates are a contentious issue for many business owners, who argue that they are unfair and place an unnecessary burden on businesses, particularly small businesses Some businesses have called for a reform of the business rates system, with proposals including a shift from property-based taxation to a turnover-based tax or a tax on online sales to level the playing field between online and brick-and-mortar retailers.
In response to these concerns, the government has announced various measures to support businesses with their business rates bills For example, in light of the COVID-19 pandemic, the government introduced a series of business rates relief schemes to provide financial support to businesses affected by the crisis These schemes included a 100% business rates holiday for retail, hospitality, and leisure businesses for the 2020-2021 tax year.
Business rates can be a complex and confusing area for many business owners, particularly those who are new to running a business It is essential for business owners to understand their business rates obligations and to seek advice from a qualified professional if they have any questions or concerns about their business rates bill.
Overall, national non-domestic business rates are a necessary expense for businesses that occupy commercial properties While they can be a significant cost for businesses, there are ways in which businesses can reduce the amount they have to pay in business rates By staying informed and taking advantage of any available relief schemes, business owners can ensure that they are not paying more than they need to in business rates.