Understanding Business Rates in the UK

  • May 16, 2022
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Business rates are a headache for many small businesses, especially since the controversial 2017 revaluation.

If you have business property, or, in some cases, if you work from home, you need to understand business rates and how much you might pay. Business rates are a tax on property used for business purposes. They are charged on properties such as offices, shops, pubs, and warehouses – most non-domestic properties will attract business rates. They may also be charged where only part of a building is used for non-domestic purposes.

Business rates are calculated based on a property’s ‘rateable value’. The rateable value is a property’s estimated value on the open market. The last revaluation, conducted by the Valuation Office Agency (VOA) and which came into effect on 1 April 2017, refers to values as of 1 April 2015.

It is possible to estimate your business rates by multiplying your property’s rateable value by the relevant number.

It’s not uncommon for business rates payers to believe that their rateable value is incorrect. If this is the case, then the business rates you are required to pay will be calculated wrongly.

First, you should check the VOA’s rateable value for your property. You may also wish to compare it with other similar properties in your area. If you still suspect that the rateable value is incorrect, you can then apply to have it changed.