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The Chancellor announced a number of support measures to assist businesses facing increasing business rates over the next 12 months.
75% reduction for some sectors
In the 2021 Autumn Statement the Chancellor announced a 50% discount on business rates to qualifying business for 12 months, up to a cash cap of £110,000. In this Autumn Statement, the relief has been extended further to grant a 75% discount to businesses occupying eligible retail, hospitality, and leisure properties in England. The discount applies for a further 12 months from 1 April 2023 and the cash cap remains the same at £110,000 per business.
Given the reduction in consumer spending, this will be welcome news for high street retailers.
Freezing the multiplier
Business rates are calculated by multiplying the rateable value (provided by the Valuation Office Agency) by either 49.9p or 51.2p depending on whether the business is ‘small’ or ‘standard’. The multiplier has historically been increased in line with CPI; however, after being frozen for 2022/23 the rate will be frozen again for another 12 months from 1 April 2023.
Temporary relief for property improvements
Following on from the temporary relief for property improvements announced in the Autumn Budget 2021, the relief start date has now been delayed such that it commences on 1 April 2024.
The temporary relief applies where businesses invest in their properties, and therefore increase the rateable value. The relief will allow business rates to be relieved for a further 12 months.
This measure will now commence from 1 April 2024 and run until 31 March 2028.
Three-year support for small and rural businesses
A cap has been introduced to help businesses losing eligibility or seeing reductions in small business rate relief or rural rate relief as a result of the 2023 business rates revaluation. The measure will cap business rate increases at £600 per year for the three years from 1 April 2023, for qualifying businesses.
Three-year transitional relief
The Chancellor announced an extension of the relief detailed in the Autumn Budget 2021 surrounding business rates revaluations.
Properties will be subject to a revaluation in 2023 which may severely increase business rates where properties have seen an increase in rateable value.
The measure announced in this Autumn Statement, will commence on 1 April 2023 and cap the increases in business rates for properties in year one on small, medium and large valued properties, as defined, such that rates will not increase by more than 5%, 15% and 30% respectively. The measure will run to 31 March 2026 with the cap increasing in later years of the scheme.
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