What are business rates?
Business rates and taxation play a crucial role in the economic landscape of the United Kingdom. They are vital sources of revenue for the government and help fund public services and infrastructure development.
Business rates, also known as non-domestic rates, are taxes levied on most non-residential properties in the UK. These rates are charged annually and are based on the estimated rental value of a property. The local authority determines the rates using a multiplier set by the central government.
Our position
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Actively pursuing a comprehensive reform of business rates in the UK
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Looking to reduce the multiplier for every property from 49 pence to around 35 pence
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Working to make the 75% discount for smaller retailers a permanent fixture
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Fighting to ensure a fast and simple process for recording and submitting details
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Campaigning for a simplification of the taxation system overall
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Reaching out not only to the current government but also opposition ministers and shadow ministers
What you can do
Businesses too can lobby their MPs for change. You can do so by contacting your local constituency office.
You can appeal your business rates with a no-win-no-fee audit here. Bira members will receive a discounted rate.
Keep us informed by letting us know of any current issues, opinions or updates. Email membership@bira.co.uk.
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How are they calculated?
The rateable value is multiplied by a rate set by the central government to determine the business rates payable. There are two multipliers: the standard multiplier and the small business multiplier. The standard multiplier applies to properties with a rateable value above a certain threshold, while the small business multiplier is for properties below that threshold. The multipliers are usually adjusted annually and are specific to each local authority.
How do they support small businesses?
To support small businesses, the government offers Small Business Rates Relief SBRR, which provides relief or a reduction in business rates. Eligibility for SBRR is based on factors such as the rateable value of the property and the business's location. The relief may vary depending on the specific circumstances, but it can result in significant savings for eligible small businesses.
What if they seem incorrect?
If a business owner believes that their rateable value is incorrect, they can lodge an appeal with the VOA. The appeal process allows businesses to present evidence to support a change in the rateable value, which can result in a revision of the business rates. It's important to note that during the appeal process, the business owner is still required to pay the business rates based on the existing rateable value.
What other tax’s are applicable?
In addition to business rates, businesses in the UK are subject to various other taxes. These include corporation tax, which is levied on a company's profits; value-added tax (VAT), a consumption tax on goods and services; and employer's National Insurance contributions, which are payroll taxes paid by employers based on their employees' earnings.
The specifics of business rates and taxation in the UK can be complex, and they may be subject to changes in government policies and legislation. It's essential for business owners to stay informed about the latest developments and consult professionals for specific guidance tailored to their circumstances.
Additional information
Bira, which advocates for smaller businesses, is actively pursuing a comprehensive reform of business rates in the UK to alleviate the burden on smaller enterprises.
For example, each business property has a multiplier which currently is set at 49 pence. Bira is looking to reduce this to around 35 pence to shrink the overall cost to a business.
Discount for Smaller Retailers
There is also a discount for smaller retailers which is currently set at 75% off a rates bill, however this isn’t a permanent feature and it gets signed off by the treasury each year.
Bira has engaged in discussions with Members of Parliament, the Department of Business and Trade, and the Treasury to champion the cause of making the 75% discount a permanent fixture. By collaborating with key stakeholders, they aim to bring about the necessary changes to benefit small businesses.
Revaluation Frequency
Another success achieved by Bira's lobbying efforts was the transition from business rates revaluation occurring every five years now to a three-year cycle.
There is going to be a requirement for a business to record and submit details on their premises, especially if they move, as it could mean an increase in the rateable value.
That extra burden gets the rates assessed quicker, however Bira is wanting to make sure that this system is easy for businesses to do and isn’t an overly bureaucratic process.
Reduce the Time Burden
Bira has been actively lobbying for this change for approximately two years, emphasising the need to simplify the process and reduce the time burden on business owners. Our efforts aim to create a more favourable environment for smaller businesses, where the business rates system supports their growth and sustainability.
Through ongoing discussions, collaborations, and advocacy, Bira strives to bring about the desired reforms to business rates, making them fairer and less burdensome for smaller enterprises in the UK.
Corporation Tax
In terms of taxes, corporation tax is another issue for our independent business owners, along with VAT.
Bira is campaigning for a simplification of the taxation system in this country.
A good tax system encourages growth and investment, along with the good performance of a business, large or small - both online and on the high street.
Bira recognises the need for simplifying the corporation tax system in the UK and is actively developing a policy to address this issue. They have engaged in discussions with the Treasury to ensure that there is a well-structured tax system that simplifies the process for businesses.
Bira understands that achieving this goal will require dedicated time and effort from all involved parties.
Our Outreach
Bira is also taking a proactive approach by reaching out to not only the current government but also opposition ministers and shadow ministers. This outreach is driven by the understanding that elections can lead to a potential change in government, and it is essential to plan ahead for any policy changes that may occur. By engaging with both sides of the political spectrum, Bira aims to ensure that their policy proposals for simplifying corporation tax receive attention and consideration, regardless of any potential shifts in political power.
Bira's efforts in developing a simplified corporation tax policy demonstrate their commitment to creating a more streamlined and business-friendly tax environment. By working closely with relevant government entities and anticipating potential changes, they aim to shape a tax system that better supports businesses in the UK.