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Getting to know business rates

Getting to grips with business rates

What are business rates?

Business rates are charges made on non-domestic properties like shops, offices, warehouses and factories. Essentially, you will be charged on a property that offers your business a source of income. You can find out more about these charges on the GOV website.

How much will I have to pay in business rates?

This depends on your property’s rateable value – the amount will be determined by your local valuation office, who will send you a business rates bill in February or March of each year.

Can I get some relief on my business rates?

You may be able to claim small business rates relief if the ‘rateable value’ of your premises is low. As a result, you may not have to pay some or the entirety of your business rates bill. To see whether you’re eligible, contact your local council.

On rare occasions, you may be granted remission from your business rates so you end up paying only part or none of the bill. This is normally in exceptional circumstances and granted on a case-by-case basis.

You may be exempt if:

  • your business cannot afford to pay the bill and is of high importance to the local community
  • you or a key stakeholder in the business cannot keep up with the day to day costs due to extreme circumstances, such as poor long-term health.

Certain properties, like farm buildings or places used for the welfare of disabled people, are exempt from business rates.

What happens if I don’t pay my business rates?

Your local council will send you several reminders if you fail to pay your bills. If you don’t respond and fail to pay the amount due, your right to pay in instalments will be removed. (After this, the council will be within its rights to demand all of the business rates for that year up front.)

What happens next is that the council can apply to the Court for a liability order – an order that confirms the bills you owe. You will then be asked to pay for this as well as the cost of the liability order application. Once a liability order has been granted, the council will be within their rights to use bailiffs to collect possessions from you in order to raise funds towards your outstanding debts.

In some circumstances, the council may send you a statutory demand to make you bankrupt, should what you owe add up to £5,000 or more. In serious circumstances you could face prison but you’d have to be secretly keeping funds back or refusing to pay.

How do I complain about my local council?

If you feel you have been treated poorly or unfairly, you can complain and express your views. First of all, contact your local council directly to try and resolve any issues quickly.

If you feel your local council have not been supportive or helpful, you can raise your case with the Local Government and Social Care Ombudsman (LGSCO) in England or the Public Services Ombudsman for Wales (PSOW) in Wales. These organisations will be able to request that your council compensate you should you find that your case is successful.  

Get free debt help

If you are self-employed and worried about your finances, or find yourself in the early stages of debt, we may be able to help you find a solution.

Running your own business can be lonely, especially when you’re facing money problems – we’re here to support you, by giving you free debt advice and a clear idea of your options. All you need to do is call 0800 316 1833 .

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