22nd May 2012
Small Business Rates Relief
19th Jan 2005
National Non-Domestic Rates - Small Business Rate Relief Scheme Explanatory Notes These notes are intended to give a helpful outline of the Small Business Rate Relief Scheme, but they should not be regarded as a complete guide to the law. (Please note that all references to Rateable Values relate to the new Rateable Values that apply from 1st April 2005). Why is the Government introducing this new rate relief scheme? The Government recognises that the current system of Business Rates places a disproportionate burden on small businesses. What Small Business Rate Relief will be available? Eligible properties with a Rateable Value of up to £5,000 will get 50% rate relief. This percentage will decrease on a sliding scale of 1% for every £100 of Rateable Value above £5,000 and up to a Rateable Value of £9,999. Eligible properties with a Rateable Value from £10,000 up to £14,999 (outside Greater London) will have rate relief of 0%. However, these properties will be in the “buffer zone”. Eligible properties, including those in the buffer zone, will have their bill calculated using the Small Business Non-Domestic Rating Multiplier [For the year 2005/06, the Small Business Non-Domestic Rating Multiplier is 41.5p per pound of Rateable Value (or 0.415), rather than the Non-Domestic Rating Multiplier of 42.2p (or 0.422) which will apply to non-eligible properties]. What is the Eligibility Criteria? The property must be within the Rateable Value thresholds above. The property must meet the criteria on every day for which eligibility is claimed. The relief is only available to ratepayers who occupy either one property, or one main property and other additional properties providing those additional properties have Rateable Values less than £2,200 and the total Rateable Value of all the properties remains under the appropriate threshold (i.e. £15,000 outside Greater London or £21,500 inside Greater London). Relief is only available on the main property and not the additional properties. Small Business Rate Relief is not available to ratepayers who are receiving either mandatory Rural Rate Relief or mandatory Charitable Relief. Do I need to apply for Small Business Rate Relief? Yes – Small Business Rate Relief is not granted automatically. The ratepayer must apply in writing to Bedford Borough Council by completing an application form for each financial year. Applications must be made no later than six months after the end of the year concerned (i.e. by 30th September 2006 for the year 2005/06). If the Rateable Value is altered so that a property comes within the Rateable Value threshold, applications can be accepted up to six months after the date of notification of the alteration. How is the bill calculated? Small Business Rate Relief will be applied to one property only. The Rateable Value threshold (under £15,000 outside London) will be based on the location of the eligible property, not the location of the additional properties. Small Business Rate Relief will be applied to the bill for each day of eligibility. As soon as a ratepayer fails to meet the criteria for Small Business Rate Relief, entitlement to this relief ceases. The rate bills for any additional properties (under £2,200 Rateable Value) will be based on the higher non-domestic rating multiplier. For properties subject to the transitional arrangements, transition is applied before the Small Business Rate Relief is applied. Who pays for the Small Business Rate Relief scheme? The scheme aims to redistribute the rates burden and, therefore, the additional cost of the scheme will be paid for by a small supplement on the Rate Poundage for all properties that do not qualify for Small Business Rate Relief. The Small Business Non-Domestic Rating Multiplier for 2005/06 is 41.5p per pound of Rateable Value and the Non-Domestic Rating Multiplier is 42.2p. This means that those paying for the relief will see a 1.6% increase in rates bills as a result. What is the Buffer Zone? Properties with a Rateable Value between £10,000 and £14,999 are in the buffer zone. Small businesses in the buffer zone will not receive Small Business Rate Relief, but they will not have to pay the supplement. Such businesses should complete an application form in order to benefit from the reduced Small Business Non-Domestic Rating Multiplier. The same eligibility criteria apply. Where can further information and application forms be obtained? If you require further information about the Small Business Rate Relief scheme or if you require an application form, please contact Bedford Borough Council, Local Taxation Office, Town Hall, P O Box 14, BEDFORD, MK40 1SH (Telephone 01234 221659, Fax 01234 221833, Email localtax@bedford.gov.uk).
For further information:
www.bedford.gov.uk
rhillson@bedford.gov.uk
Contact Richard Hillson
