Background
Background

Exemptions and Relief from Business Rates

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Business Rates exemption and relief

Unoccupied property rating

Business rates will not be payable in the first three months that a property is empty. This is extended to 6 months in the case of certain industrial properties. After this period, rates are payable in full unless the unoccupied property rate has been reduced by the Government by order. In most cases, the unoccupied property rate is zero for properties owned by charities and community amateur sports clubs. In addition, there are a number of exemptions from the unoccupied property rate. If the unoccupied property rate for the financial year has been reduced by order, it will be shown on the front of your bill.

Small business rate relief

Ratepayers who occupy a property with a rateable value which does not exceed £50,999 (and who are not entitled to other mandatory relief or are liable for unoccupied property rates) will have their bills calculated using the lower small business non-domestic rating multiplier, rather than the national non-domestic rating multiplier.

In addition, generally, if the sole or main property is shown on the rating list with a rateable value which does not exceed £15,000, the ratepayer will receive a percentage reduction in their rates bill for this property of up to a maximum of 100%.  For a property with a rateable value of not more than £12,000, the ratepayer will receive a 100% reduction in their rates bill.

Generally, this percentage reduction (relief) is only available to ratepayers, on one property, who occupy either-

(a) one property, or

(b) one main property and other additional properties providing those additional properties each have a rateable value which does not exceed £2,899.

The rateable value of the property mentioned in (a), or the aggregate rateable value of all the properties mentioned in (b), must not exceed £19,999 outside London or £27,999 in London on each day for which relief is being sought.  If the rateable value, or aggregate rateable value, increases above those levels, relief will cease from the day of the increase.

The Government has introduced additional support to small businesses. For those businesses that take on an additional property which would normally have meant the loss of small business rate relief, the Government has confirmed that they will be allowed to keep that relief for a period of 12 months.

An application for small business rate relief is not required. Where a ratepayer meets the eligibility criteria and has not received the relief they can apply by downloading this form. Provided the ratepayer continues to satisfy the conditions for relief which apply at the relevant time as regards the property and the ratepayer, they will automatically continue to receive relief in each new valuation period.

Certain changes in circumstances will need to be notified to the local authority by a ratepayer who is in receipt of relief (other changes will be picked up by the local authority).  The changes which should be notified are-

(a) the ratepayer taking up occupation of an additional property, and

(b) an increase in the rateable value of a property occupied by the ratepayer in an area other than the area of the local authority which granted the relief.

Rural relief 

What are the general qualifying criteria?

The applicant must be liable to pay National Non-Domestic Rates to Copeland Borough Council, the Rateable Value of the property at the beginning of the rating year concerned must not exceed a specified amount, and (except where the application relates to former agricultural premises) the business must be located in a qualifying Rural Settlement.  A qualifying Rural Settlement must have a population not exceeding 3,000 and will usually be a village or hamlet. 

What are the qualifying criteria for Mandatory Relief?

A. For a Post Office or General Store to be entitled to 100% Mandatory Relief), all of the following criteria must be met :-

  1. The Rateable Value of the property must not exceed £8,500
  2. The property must be used as a Post Office or a General Store (see below for definition), or both.
  3. The property must be the only Post Office or the only General Store in the Rural Settlement.

B. For a Public House or Petrol Filling Station to be entitled to 100% Mandatory Relief, all of the following criteria must be met :-

  1. The Rateable Value of the property must not exceed £12,500
  2. The property must be used as a Public House (see below for definition) or a Petrol Filling Station (see below for definition)
  3. The property must be the only Public House or the only Petrol Filling Station in the Rural Settlement.

C. For a village food shop to be entitled to 100% Mandatory Relief all the following criteria must be met :-  

  1. The Rateable Value of the property must not exceed £8,500
  2. The property must be used as a shop selling mainly food (see below for definition).

Definition of a General Store?

For the purposes of Rural Rate Relief, “General Store” means a business or trade which wholly or mainly sells by retail both food (other than confectionery) for human consumption and general household goods.  Where there are two or more General Stores within the same Rural Settlement, none can qualify for Mandatory Relief on that basis, although if one of them functions as a Post Office or a Food Shop relief may be claimed independently on that ground.  However, both a General Store and a Post Office in the same Rural Settlement will qualify for Mandatory Relief, provided that they both meet the criteria.  Although a General Store or a Post Office may not meet the criteria for Mandatory Relief, they may still be eligible to apply for Discretionary Relief.

Definition of a Public House?

For the purposes of Rural Rate Relief, “Public House” means any premises as defined in the Licensing Act 2003 which has a premises licence authorising sale by retail of alcohol for consumption on the premises. In addition the premises must be used principally for retail sales of alcohol to members of the public for consumption on the premises, and sales must not be subject to the condition that buyers reside at or consume food on the premises.

Definition of a Petrol Filling Station?

For the purposes of Rural Rate Relief, “Petrol Filling Station” means premises where petrol or other automotive fuels are sold retail to the general public for fuelling motor vehicles intended or adapted for use on roads

Definition of a Food Shop?

For the purpose of Rural Rate Relief, “Food Shop” means a trade or business consisting wholly or mainly of the sale by retail of food for human consumption (excluding confectionery and catering – in this context catering means any supply of food for consumption on the premises on which it is supplied and any supply of hot food for consumption off the premises).   Thus, this definition may also include shops which sell mainly household foods and which may partly also sell hot take away food or food consumed on the premises.   But shops whose main business is a restaurant, tea room, take-away, or confectionery sales are not Food Shops and so will not qualify for Mandatory Relief.

What are the qualifying criteria for Discretionary Relief?

The Council may also grant up to 100% Discretionary Relief to any rural business provided that all of the following criteria are met:- 

  1. The property is located in a qualifying Rural Settlement.
  2. The Rateable Value of the property does not exceed £16,500 (£14,000 prior to 1 April 2010) at the beginning of the rating year concerned.
  3. The property is occupied by a business that benefits the local community.
  4. It is reasonable for the Council to grant relief having regard to the interests of persons liable to pay the Council Tax set by it.

Discretionary Relief is not limited to any particular type of business.  Applicants will be expected to demonstrate that their business is important to the maintenance of village life.

  

Published: 23 May 2012 - 9:58am