by Nick Robinson | May 24, 2016 | Business
Business rates are what business owners pay when they are the occupiers of a non-domestic property – that is, they own or rent a shop, office, or other business building that isn’t part of their home. The rates payable depend on the size of the business and the area in which is it located, and there are specific ways to work out how much is owed.
Since April 2013, rather than the money gathered from business rates (also known as non-domestic rates) being paid into one central pool that was then redistributed by the government, the local authority is able to keep around half of the money collected to be used within the local economy. Everything that is left over goes to the government where it is then re-allocated through grants.
It is possible to pay your business rates through 12 monthly instalments if that is easier for your cashflow. As well as this, charities and not for profit organisations can receive some discretionary payment relief.
Business rates are calculated using the multiplier that is set by the government. This is checked each year and is often changed to keep it inline with inflation. There is a special small business multiplier for those businesses with a rateable value of under £18,000. For some businesses with a rateable value of less than £12,000 there is complete business rate relief benefit.
The rateable value of a business is set by the central Valuation Office Agency, and is used to calculate all business rates across the UK.