Business Rates Explained
National Non-Domestic Rates are a statutory tax levied by central government on those responsible for commercial property. National Non-Domestic Rates are also referred to as Business Rates. They are the equivalent of Council Tax for non-domestic properties.
Business Rates are a national tax set by Central Government, therefore Councils’ cannot alter the amount of rates due.
However, if you believe your Business Rate charges are too high or there has been a change in material circumstances, then you can appeal to the Valuation Office for reassessment.
If you are appealing, please note that the Government Regulations require you to pay the rates based on the current rateable value until the appeal has been concluded.
If you are successful in your appeal and the rateable value is reduced, then any overpayment of rates made will be refunded to you. Provided payments have been made on time, interest is awarded at a rate specified by the Government annually.
Check, Challenge and Appeal
In 2017 a new business rates appeal process came into effect in England and Wales known as Check, Challenge, Appeal. The Valuation Office Agency (VOA) deals with checks and challenges, while the independent Valuation Tribunal for England handles appeals.
Check and Challenge
You can review your rateable value on the GOV.UK website, and if you have reason to believe that your 2017 rateable value is not correct, details on how to check and challenge can be found on their website.
- Check – review and confirm the facts about your property held by the VOA
- Challenge – once the facts are established, explain why you believe your valuation is wrong
To appeal your business rates you will need to complete the Check and Check and Challenge process.
If you wish to be represented
Members of the Institute of Revenues Rating and Valuation are qualified and are regulated by rules of professional conduct designed to protect the public from misconduct.
Before you employ a rating agent, check that they have the necessary knowledge and expertise and the appropriate indemnity insurance. If necessary, seek further advice before entering into a contract.
The Valuation Office Agency gives advice on rating agents
When to Pay
- For a full financial year by 10 monthly instalments due by 15th day of each month from April to January inclusive.
- For a full financial year by 12 monthly instalments by 15th day of each month from April to March inclusive. You will have to make your request in writing to the Council in order to do this.
- Bills issued after 1st April will have their monthly instalments calculated by the number of months left in the financial year less one.
- By a single payment by the 15th April.
- Twice yearly with a sum equal to five monthly instalments by the 15th April with the balance by 15th September.
There are a number of different methods of payment available for you to choose from. We would prefer you to use one of the electronic methods.
How Do I Pay Online?
You can pay your Non-domestic (Business) Rates by debit or credit card online using our online payment system:
Can I set up a direct debit?
Yes, by using our Direct Debit form
If you are having problems paying your Business Rates then please Contact us immediately.
What are the steps taken if I do not pay?
If a Business Rates instalment is not paid then the following steps will be taken by the Council.
- Reminder – Reminder letter sent
- Final Notice issued – You may receive this notice under certain circumstances but not always. This notice stops your right to pay by instalments and requests that the full balance remaining on the account is paid within 7 days.
- Court Summons – If payment is not received following the Reminder and/or Final Notice then a summons will be issued and the person liable will have to appear at a designated Magistrates Court. Further cost will be incurred due to the court costs. There is no need to attend court if you accept that the Business Rates is due.
- Further Steps – At the court hearing the Council will ask for the Magistrates to issue a liability order. This will enable the Council to take further steps to recover outstanding Council Tax. See how the Council recovers unpaid Business Rates in the section below.
How the Council recovers unpaid Business Rates
The council may take the following methods when recovering Business Rates
The debt is paid off in a number of instalments
We may refer your debt to our in-house Enforcement Agents for collection. We may on occasion use external Enforcement Agents.
This will mean you will have to pay Enforcement Agent fees.
Any payment or arrangements for payment will have to be made directly with them. They have the power to remove your goods if they don’t get payment in full or a suitable payment arrangement.
Bankruptcy or Winding up proceedings
The Council can commence bankruptcy or winding up proceedings against you.
The Council can take the debtor back to court and if proven that the debtor has shown ‘wilful refusal’ or ‘culpable neglect’ to pay their Council Tax they may be imprisoned.
If you receive a committal warning you must contact us to arrange to clear the debt.
If committal action is taken you have to appear before the Court to answer why you shouldn’t be sent to prison for non-payment.
If your business is moving in or out of the district, you can tell us here;
- Tell Business Rates that you’re Moving into Wealden – if you are moving from outside the Wealden District into a property within the District
- Tell Business Rates that you’re Moving within Wealden – if your move is from one property to another within the District
- Tell Business Rates that you’re Moving out of Wealden – if you are moving to a property out of Wealden.
There are different reliefs available for business premises depending on its status and use – please see the relief details below for more information.
Expanded Retail Discount (ERD)
Expanded Retail Discount 2019-20, 2020-21 and 2021-22 / Expanded Retail Discount for occupied retail, leisure and hospitality properties.
The Government announced in the Budget on 29th October 2018 that it will provide a Business Rates Retail Discount scheme for occupied retail properties with a rateable value of less than £51,000 in each of the years 2019-20 and 2020-21. This was further extended in the budgets held on the 11th March 2020 and the 3rd March 2021.
You can find further information in the Government Guidance
Discount for 2019-20 was one third of the bill for occupied retail properties only.
Discount 2020-21 this was extended to Leisure and Hospitality occupied properties at a full 100% of the bill.
Discount for 2021-22 a discount of 100% is given for Retail, Leisure and Hospitality properties for the first 3 months from the 1st April 2021 to the 30th June 2021. From the 1st July 2021 qualifying properties can get a discount of 66% but are subject to a national cap limit (see below).
This discount must be applied after mandatory reliefs and other discretionary relief (bar charitable relief).
Please note that the Government have not yet indicated whether this scheme will operate again in 2022-23.
To qualify, the retail property should be wholly or mainly used as a shop, retail place, restaurant, cafe or drinking establishment. The Council will consider each award based on individual merits and reserves the right to decline or withdraw an award.
Eligible retail properties descriptions
Hereditaments that meet the eligibility for Expanded Retail Discount will be occupied hereditaments which meet all of the following conditions for the chargeable day:
they are wholly or mainly being used:
- as shops, restaurants, cafes, drinking establishments, cinemas and live music venues,
ii. for assembly and leisure; or
iii. as hotels, guest & boarding premises and self-catering accommodation,
- We consider shops, restaurants, cafes, drinking establishments, cinemas and live music venues to mean:
Hereditaments that are being used for the sale of goods to visiting members of the public:
- Shops (such as: florists, bakers, butchers, grocers, greengrocers, jewellers, stationers, off licences, chemists, newsagents, hardware stores, supermarkets, etc)
- Charity shops
- Post offices
- Furnishing shops/ display rooms (such as: carpet shops, double glazing, garage doors)
- Car/caravan show rooms
- Second-hand car lots
- Petrol stations
- Garden centres
- Art galleries (where art is for sale/hire)
Hereditaments that are being used for the provision of the following services to visiting members of the public:
- Hair and beauty services (such as: hairdressers, nail bars, beauty salons, tanning shops, etc)
- Shoe repairs/key cutting
- Travel agents
- Ticket offices e.g. for theatre
- Dry cleaners
- PC/TV/domestic appliance repair
- Funeral directors
- Photo processing
- Tool hire
- Car hire
- Employment agencies
- Estate agents and letting agents
- Betting shops
Hereditaments that are being used for the sale of food and/or drink to visiting members of the public:
- Sandwich shops
- Coffee shops
Hereditaments which are being used as cinemas
Hereditaments that are being used as live music venues:
- Live music venues are hereditaments wholly or mainly used for the performance of live music for the purpose of entertaining an audience. Hereditaments cannot be considered a live music venue for the purpose of business rates relief where a venue is wholly or mainly used as a nightclub or a theatre, for the purposes of the Town and Country Planning (Use Classes) Order 1987 (as amended).
- Hereditaments can be a live music venue even if used for other activities, but only if those other activities (i) are merely ancillary or incidental to the performance of live music (e.g. the sale/supply of alcohol to audience members) or (ii) do not affect the fact that the primary activity for the premises is the performance of live music (e.g. because those other activities are insufficiently regular or frequent, such as a polling station or a fortnightly community event).
- There may be circumstances in which it is difficult to tell whether an activity is a performance of live music or, instead, the playing of recorded music. Although we would expect this would be clear in most circumstances, guidance on this may be found in Chapter 16 of the statutory guidance issued in April 2018 under section 182 of the Licensing Act 2003
We consider assembly and leisure to mean:
Hereditaments that are being used for the provision of sport, leisure and facilities to visiting members of the public (including for the viewing of such activities).
- Sports grounds and clubs
- Museums and art galleries
- Sport and leisure facilities
- Stately homes and historic houses
- Tourist attractions
- Wellness centres, spas, massage parlours
- Casinos, gambling clubs and bingo halls
Hereditaments that are being used for the assembly of visiting members of the public.
- Public halls
- Clubhouses, clubs and institutions
We consider hotels, guest & boarding premises and self-catering accommodation to mean:
Hereditaments where the non-domestic part is being used for the provision of living accommodation as a business:
- Hotels, Guest and Boarding Houses
- Holiday homes
- Caravan parks and sites
To qualify for the discount the hereditament should be wholly or mainly being used for the above qualifying purposes. In a similar way to other reliefs (such as charitable relief), this is a test on use rather than occupation. Therefore, hereditaments which are occupied but not wholly or mainly used for the qualifying purpose will not qualify for the relief. For the avoidance of doubt, hereditaments which have closed due to the government’s advice on COVID19 should be treated as occupied for the purposes of this relief.
The list below sets out the types of uses that the government does not consider to be an eligible use for the purpose of this discount. Again, it is for local authorities to determine for themselves whether particular properties are broadly similar in nature to those below and, if so, to consider them not eligible for the discount under their local scheme.
Hereditaments that are being used for the provision of the following services to visiting members of the public
- Financial services (e.g. banks, building societies, cash points, bureaux de change, short-term loan providers)
- Medical services (e.g. vets, dentists, doctors, osteopaths, chiropractors)
- Professional services (e.g. solicitors, accountants, insurance agents/ financial advisers)
- Post office sorting offices
Hereditaments that are not reasonably accessible to visiting members of the public
No cash caps will apply for 2020-21 or the period between 1st April 2021 to 30th June 2021.
Under the cash caps, a ratepayer may only receive up to the following cash caps of Expanded Retail Discount in 2021/22 ignoring any relief for the period before 1st July 2021:
- £2 million for ratepayers meeting the eligibility for the closed cash cap test set out below, or
b. £105,000 for all other ratepayers (see below).
No ratepayer can in any circumstances exceed the £2 million cash cap across all of their hereditaments in England. Where a ratepayer eligible for the closed cash cap also occupies hereditaments which do not meet the criteria for the closed cash cap and the value of the discount on the closed hereditaments is less than £2 million then they may also claim the discount on other eligible hereditaments but only up to the cap of £105,000 in respect of those other eligible hereditaments. For example, such a ratepayer whose rate bill from 1st July 2021 onwards on hereditaments eligible for the closed cash cap is £1 million and also occupies other eligible hereditaments with a rates bill of £3 million is able to claim up to £1,105,000 in expanded retail discount from 1st July 2021 onwards (£1million on their closed hereditament and then up to the £105,000 cash cap on their other eligible hereditaments).
Where a ratepayer has a qualifying connection with another ratepayer then those ratepayers should be considered as one ratepayer for the purposes of the cash caps. A ratepayer shall be treated as having a qualifying connection with another:
- where both ratepayers are companies, and
i. one is a subsidiary of the other, or
ii. both are subsidiaries of the same company; or
b. where only one ratepayer is a company, the other ratepayer (the “second ratepayer”) has such an interest in that company as would, if the second ratepayer were a company, result in its being the holding company of the other.
In those cases where it is clear to the local authority that the ratepayer is likely to breach the cash caps then the authority should automatically withhold the discount.
Any business receiving the Expanded Retail Discount has a duty to inform the Council if they believe by receiving the discount they will exceed the cash cap.
Local authorities may ask ratepayers on a self-assessment basis (either on the business rates bill or in a letter or email to inform the Council if they are in breach of the cash caps. This could include the completing of a form.
Eligibility for the Closed Cash Cap (£2 million)
Ratepayers that meet the eligibility criteria for the closed cash cap will be ratepayers who for a chargeable day occupy one or more hereditaments whose use on the chargeable day would, based on the law and guidance applicable on 5th January 2021, have meant that the business or activity would have been mandated to close by the government.
For the avoidance of doubt, hereditaments which have closed due to the government’s response to coronavirus should be treated as occupied for the purposes of the closed cash cap. Full details of businesses mandated to close are in the Government Guidance.
If, under this eligibility test, a person would have been required to close its main, in-person service but could have adapted its business to operate takeaway, click and collect or online with delivery services, it will be considered closed and be eligible for the closed cash cap because its substantive business would have been mandated to close.
In cases where hereditaments would have remained open to provide services that can continue as they are exempt from the regulations (e.g. post office services, food banks) the ratepayer may still be eligible for the closed cash cap, because they would have been unable to provide their main in-person service.
The following hereditaments do not meet eligibility for the closed cash cap:
- Hereditaments occupied by businesses and other ratepayers that would have been able to conduct their main service because they do not depend on providing direct in-person services from premises and can operate their services effectively remotely (e.g. accountants, solicitors).
- Hereditaments whose occupiers may have chosen to close but not been required to.
Eligibility for the Expanded Retail Discount and the discount itself will be assessed and calculated on a daily basis. The Expanded Retail Discount will be applied against the net bill after all other reliefs (apart from charitable relief).
Ratepayers that occupy more than one property will be entitled to relief for each of their eligible properties, subject to the Cash Pot limits.
In line with the legal restrictions in section 47(8A) of the Local Government Finance Act 1988, billing authorities may not grant the expanded retail discount to themselves or a precepting authority. A “precepting authority” includes fire, police and parish councils or a functional body, within the meaning of the Greater London Authority Act 1999
Apply for Expanded Retail Discount
Opt Out of Expanded Retail Discount
The ratepayer may refuse the discount for each eligible hereditament for the 2021/22 financial year anytime up to 30th April 2022. The ratepayer cannot withdraw their refusal for either all or part of the financial year.
For the purposes of section 47 of the 1988 Act, hereditaments where the ratepayer has refused the relief are outside of the scheme and outside of the scope of the decision of which hereditaments qualify for the discount and are therefore ineligible for the relief.
Property Relief (s44A)
A ratepayer is liable for the full non-domestic rate whether a property is wholly occupied or only partly occupied.
Where a property is partly occupied for a short time, the local authority has discretion in certain cases to award relief in respect of the unoccupied part.
For further details see the Part Occupation guidelines .
Apply for Partly Occupied Property Relief
If you would like more information about Partly Occupied Relief or any other reduction please contact us using our online contact us form.