Business rates – an overview

Business rates – the commonly used term for non-domestic rates – are charged on most non-domestic premises, including most commercial properties such as shops, offices, pubs, warehouses and factories.

If you use a building or part of a building for business, you will probably have to pay business rates. Your premises will be given a rateable value by the Valuation Office Agency, which your local authority will use to calculate how much you should pay.

This guide explains how business rates are calculated, what they are used for, and the definitions of some key words and phrases. It also gives details of professional organisations that can provide further help and advice.

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Business rates

Business rates is a local tax that is paid by the occupiers of non-domestic property in England and Wales.

Business rates help to pay for local services. How much you pay will depend on:

• the rateable value of the property, which is set by the Valuation Office Agency (VOA) – see the page rateable value in our guide on how business rates valuations are calculated
• what multiplier is set by central government – see the page in this guide on the business rate multiplier
• what rate relief schemes you are eligible for, which are applied by your local council when they work out your bill – see our guide on business rates relief

What business rates are used for

Business rates are calculated and collected by your local authority. They are put in a central pool and then redistributed to local authorities to meet the needs of particular authorities.

The money raised through business rates is used to help fund local services like the police, fire and rescue services.

What to pay and when

Your local authority will send you your business rates bill in February or March each year. This will be for the next financial year – for example, April 2012 to March 2013.

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The current multipliers

The multiplier is used by your local authority when calculating your business rates bill. It indicates the percentage, or pence in the pound, of the rateable value that you will pay in business rates.

Multipliers – England and the City of London

	England		City of London
	Standard	Small business	Standard	Small business
2012/13	45.8p	45.0p	46.2p	45.4p
2011/12	43.3p	42.6p	43.7p	43.0p
2010/11*	41.4p	40.7p	41.8p	41.1p
2009/10	48.5p	48.1p	48.9p	48.5p
2008/09	46.2p	45.8p	46.6p	46.2p
2007/08	44.4p	44.1p	44.8p	44.5p
2006/07	43.3p	42.6p	43.7p	43.0p
2005/06*	42.2p	41.5p	42.5p	N/A
2004/05	45.6p	N/A	45.9p	N/A
2003/04	44.4p	N/A	44.7p	N/A
2002/03	43.7p	N/A	N/A	N/A
2001/02	43.0p	N/A	N/A	N/A
2000/01*	41.6p	N/A	N/A	N/A
1999/00	48.9p	N/A	N/A	N/A

Multipliers – Wales

	Wales
	Standard (applies to all ratepayers)
2012/13	45.2p
2011/12	42.8p
2010/11*	40.9p
2009/10	48.9p
2008/09	46.6p
2007/08	44.8p
2006/07	43.2p
2005/06*	42.1p
2004/05	45.2p
2003/04	44.0p
2002/03	43.3p
2001/02	42.6p
2000/01*	41.2p
1999/00	44.3p

* indicates a revaluation year

The small business rate multiplier was introduced in 2005/06.

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The business rate multiplier

The multiplier is used by your local authority when calculating your business rates bill. It’s also known as the ‘uniform business rate’.

The multiplier indicates the percentage, or pence in the pound, of the rateable value that you will pay in business rates. It is set at each revaluation by Communities and Local Government in England and the Welsh Government. The City of London can set its own multiplier.

The standard multiplier is calculated by adding supplement to the small business rate multiplier to fund small business rate relief. The small business rate relief multiplier increases each year by the annual Retail Prices Index inflation rate for September.

You can find a list of current and previous multipliers on the page in this guide on the current multipliers.

The small business rate multiplier

The small business rate multiplier is a reduced multiplier used in England when the council calculates the bill for any businesses who qualify for small business rate relief. The way the relief applies varies between England and Wales – for information on whether your business qualifies, see the page small business rate relief in our guide on business rates relief.

How the multiplier works at revaluation

Revaluation takes place every five years to maintain fairness by ensuring that rateable values reflect changes in the property market. The most recent revaluation came into effect on 1 April 2010. At revaluation, the multipliers are revised so that the overall national business rates bill only changes in line with inflation. This means that a change in your rateable value does not always mean a corresponding change in your bill.

For example, you might be paying rates on a building in Manchester and the rateable value increases, at revaluation, from £14,800 to £17,400. The change in the multiplier means the bill actually goes down.

Example calculation

	rateable value	x	multiplier	=	bill before additional reliefs
2009/10	£14,800	x	£0.481	=	£7,118
2010/11	£17,400	x	£0.407	=	£7,081

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Local authority rating lists

The rating lists are lists of all the rateable values for non-domestic property in England and Wales. There is a separate list for each local authority that calculates and collects business rates bills.

New rating lists are published every five years, at revaluation:

• the 2010 list came into effect on 1 April 2010 and will last until the next revaluation
• the 2005 list came into effect on 1 April 2005 and lasted until 31 March 2010
• the 2000 list came into effect on 1 April 2000 and lasted until 31 March 2005

If there is a ‘material change’, or some other reason for altering the rateable value, its entry is altered in the rating list.

The Valuation Office Agency (VOA) also publishes draft lists six months before new lists are published. This gives you the opportunity to check your new valuation before your local authority calculates your business rates bill.

Finding your valuation information online

The 2010, 2005 and 2000 lists are all available to view online.

Find your 2010 valuation with the VOA.

To see the 2005 and 2000 assessments, find your 2010 valuation and click on the “View previous valuations” button.

The 2010 and 2005 lists include the rateable value and, for most properties, a breakdown of the valuation. The VOA did not produce these breakdowns in 2000.

For some types of property, the breakdown is not published online. This may be because the information is restricted or commercially sensitive.

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The central rating list

The central rating list contains the rating assessments of the network property of major transport, utility and telecommunications undertakings and cross-country pipelines. There is a single entry in the rating list for each company named in The Central Rating List Regulations 2005.

There are separate regulations and lists for England and Wales.

A single aggregate rateable value is given for all the property occupied by a named ratepayer that falls within their definition in the regulations. Any property occupied by that ratepayer that falls outside the definition will be shown individually in a local rating list.

Rates on central rating list properties in England are paid directly to the Secretary of State for Communities and Local Government, and in Wales to the Welsh Government.

The lists show the rateable values currently in force for each ratepayer.

Download the 2010 England central rating list [opens in a new window].

Download the 2010 Wales central rating list from the VOA website [opens in a new window].

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Professional rating bodies

There are several professional organisations that can put you in touch with a qualified rating surveyor. Rating surveyors – often known as rating agents – can provide advice on your rateable value or represent you when dealing with the Valuation Office Agency (VOA).

The majority of agents are reputable, and will belong to one of the following professional organisations:

• the Royal Institution of Chartered Surveyors (RICS) – find a surveyor on the RICS website- Opens in a new window
• the Institute of Revenues, Rating and Valuation (IRRV) – find a valuer member on the IRRV website- Opens in a new window
• the Rating Surveyors Association (RSA) – find a surveyor on the RSA website- Opens in a new window

You may be charged for any professional rating advice that you receive from these bodies right from the start. You can call the RICS Enquiry Line on Tel 0870 333 1600 to consult with a local chartered surveyor – the first 30 minutes of the consultation will be free.

If you want to consult an agent, you can:

• ask the professional organisations for a list of reputable agents in your area
• check the credentials of an agent who has approached you with their professional organisation

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