On Wednesday George Osbourne announced within the autumn statement 2015 that the temporary increase in Small Business Rates Relief is to be extened until April 2017, a policy which is claimed to support over 600,000 businesses across the UK. Despite this, a further delay of the business rates review has caused a much greater stir across the commercial property sector.
Autumn Statement 2015 announces Small Business Rates Relief extension
What is Small Business Rates Relief ?
Small Business Rates Relief is a policy adopted by the UK Government from the 1st April 2005 and subsequently extended in 2010, that is designed to encourage the growth of small businesses by exempting or reducing the cost of business rates payable. In order to qualify for Small Business Rates Relief a business has to be in occupation of only one property and the property’s rateable value must be below £12,000. Within East Anglia this would typically equate to industrial units below 1,200 sq. ft. and office space below 600 sq. ft. (albeit this varies depending on location and unit quality).
Any property with a rateable value below £6,000 can apply for complete exemption of Business Rates. Between £6,000-£12,000, Business Rates payable are on a sliding scale, incrementally increasing from 0% to 100%.
The extension of Small Business Rates Relief is a positive move to sustain the growth of entrepeneurs and small businesses across the country. Each year since 2010 (when the relief was extended to 100% exemption below £6,000) the Small Business Rates Relief has been prolonged by a further year, one of a number of factors indicating that the business rating structure has clearly been in need of reform for some time.
Whilst the Small Business Rates Relief is viewed as a lifeline to smaller organisations, it is a support system that will, in time, subside, as the offsetting of the cost cannot be continuously be absorbed by larger businesses. The original Small Business Rates Releif, which double in 2010, is inevitably going to return to 50%. This extension, as such, only confirms the continuity of the inflated business rates payable by medium to larger organisations, particularly challenging for those that lie just outside of the small business rates relief catchment.
A further year’s increase in the ‘temporary’ Small Busness Rates Relief is therefore only further indicative that the government recognise the current system is flawed, however once again, the business community will have to sit back and wait in order to see howand when reform will occur.
In the meantime, small businesses should take advantage of the Small Business Rates Relief and furter information on how to apply for examptions or reductions can be found on your local council’s website.
At Barker Storey Matthews now part of Eddisons we provide a comprehensive rating service to our clients and regularly obtain significant reductions in rating assessments. In almost all cases we act on a performance related basis, and our experienced property specialists would be more than happy to launch an appeal on your behalf. The deadline for business rates appeals covering the last business rates year (from the 1st April 2015) is the 31st March 2016. To find out whether you would be eligible for a business rates appeal contact your nearest Barker Storey Matthews office:
Bury St Edmunds: 01284 702655
Cambridge: 01223 467155
Huntingdon: 01480 451578
Peterborough: 01733 897722
by. Martin Hughes BSc (Hons) MRICS, Director & Rating specialist