Transitional arrangements

After a revaluation, your business rates bill may be reduced by transitional relief automatically if your bill has increased more than the amount that the Government says it should.

Business Rates customers face a periodic general revaluation of the rateable values of their business premises. This process ensures that the rateable values given to each property, and which ultimately are used to calculate business rates bills, are a true reflection of the current rental values of properties at that time.

As a result of this process, businesses may find that they face a large increase or decrease in their Non-Domestic Rates bill.

To try to minimise the financial effect that a general revaluation may have on businesses, the government introduced Transitional Arrangements.

These regulations aim to ‘phase in’ any adjustments to the amount payable by a business. The phasing in process is aimed at customers facing increases in their bills and businesses receiving large reductions may also be affected by transitional arrangements. This may be reflected in your bill as transitional relief or transitional surcharge. Surcharge no longer applies in respect of the 2023 Rating List.

The principle behind this scheme is to ensure that businesses will not either be expected to pay, or receive a reduction in their bills, by more than a pre-set percentage each year which is determined by the Government.

Information on transitional relief for 2023/24 onwards can be found at Business rates relief: Transitional relief - GOV.UK (www.gov.uk)

2023 - Transitional relief

At a general revaluation some rateable values increase and others may be reduced. When these new rateable values are introduced, some ratepayers would find that their rates bill had risen or reduced considerably.

The government introduced transitional arrangements, so that ratepayers would not receive a large increase or reduction in their bill.

Information on transitional relief for 2023/24 onwards can be found at Business rates relief: Transitional relief - GOV.UK (www.gov.uk) Surcharge no longer applies in respect of the 2023 Rating List.

Extension of Transitional Relief and Supporting Small Business Relief for small and medium properties 2022/23

The transitional relief scheme was introduced in 2017 to help those ratepayers who were faced with higher bills as a result of the revaluation. The scheme ends on 31 March 2022, as a result a small number of ratepayers would face a jump to their full rates bill from 1 April 2022.

At the Budget on 27 October 2021 the government therefore announced that it would extend the current transitional relief scheme and the supporting small business scheme for one year to the end of the current revaluation cycle. The scheme will restrict increases in bills to 15% for businesses with small properties (up to and including £20,000 rateable value) and 25% for medium properties (up to and including £100,00 rateable value).

The extension of transitional relief and Supporting Small Business (SSB) relief scheme is likely to amount to subsidy. Any relief provided by Local Authorities under this scheme will need to comply with the UK’s domestic and international subsidy control obligations.

Relief will be awarded automatically. If you think you may qualify for this relief and have not received it, please contact us.

Further information can be found at Extension of Transitional Relief and Supporting Small Business Relief for small and medium properties