How Business Rates are Calculated

How Business Rates are Calculated

How Business Rates are Calculated

July 14, 2019

Business rates are a tax which is charged on most non-domestic property such as shops, offices, pubs, warehouses, factories and holiday homes/guest houses.  It is likely you will need to pay business rates if you use a building or part of a building for non-domestic purposes.

The local council in your area sends you a bill for the rates in either February or March each year, to charge for the following tax year.  Some property is exempt from paying business rates, such as farm buildings, or places which are used for the welfare of disabled people.

The rates are calculated based on the property’s “rateable value”.  This is the open market rental value on 1 April 2015, based on an estimate by the VOA.  The business rates are then produced by taking the rateable value and multiplying it by the correct “multiplier”, as set by the government.  Sometimes, your property might be eligible for business rates relief.

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