How are business rates calculated?
Business rates, or non-domestic rates, are a tax on property used for business purposes.
Business rates are calculated using the property’s ‘rateable value’ (RV). This is an estimate of its open market rental value on 1 April 2015. The current Rating List was updated in 2017 and will next be updated in 2021, using open market rental values from 1 April 2019.
You can check your current rateable value on the Government’s business rates valuation page.
The RV of the property is multiplied by a multiplier, set by the Government on the first of April each year. The Government sets two multipliers: the Small Business Non-Domestic Rate Multiplier for small businesses and the Non-Domestic Rate Multiplier for other businesses. Small businesses are those with an RV below £51,000. The standard multiplier is used for businesses with an RV of £51,000 or more.
If you qualify for small business rate relief, the multiplier for 2018/19 is set at 48p for each pound. For all other properties, the standard multiplier is set at 49.3p per pound.
|Year||Standard multiplier||Small business multiplier|
|2018 to 2019||49.3p||48.0p|
|2017 to 2018||47.9p||46.6p|
|2016 to 2017||49.7p||48.4p|
There are different multipliers in Wales and the City of London.
Business rates are handled differently in Scotland and Northern Ireland.