With the Spring Statement coming soon, there may be some businesses hoping that some of the more challenging announcements from the Autumn Budget will be adjusted.
However, many are labelling the Spring Statement as a non-event, with some calls to scrap the thing entirely.
As such, businesses need to understand how business rates are set to change and what it will mean for them.
How are business rates changing?
When discussing business rates, it is worth remembering that the different countries of the UK may follow different rules.
The Autumn Budget focused on changing the annual business rates multiplier in England, as it was announced that it would decrease by between 11.7 per cent and 13.5 per cent.
Some may have initially reacted positively to the announcement, but any joy was set to be short-lived when it was determined that many occupiers would end up paying more.
This is due to the rising rateable values and new supplements that can drive up costs.
For properties that do not qualify for transitional relief, a temporary 1p increase in the multiplier will be introduced for the 2026/2027 year.
Is Retail, Hospitality and Leisure (RHL) relief changing?
From April 2026, Retail, Hospitality and Leisure (RHL) relief will reduce again.
This will mean that properties that have a rateable value of up to £51,000 will receive around 20 per cent relief, while those between £51,000 and £500,000 will receive 10 per cent relief.
These changes come on the back of the drop from 75 per cent to 40 per cent in 2025/2026.
On the whole, these changes are a bit of a mixed bag, depending on the size of your business.
Larger occupiers who previously funded the relief may find the changes alleviate some of the burden, while smaller businesses might struggle under tighter margins.
Pubs and live music venues are receiving special consideration and so will be uniquely impacted by changes.
Business rate bills are set to be cut by 15 per cent for pubs and live music venues from April 2026.
This is designed as a lifeline to a struggling sector, but is likely to be viewed with envy by other businesses feeling the pressure.
How will property owners be impacted by the changes?
As the changes centre on the value of property, it is worth considering how the owners of those properties will be impacted.
Properties with a rateable value higher than £500,000 will be affected by the super supplement, which is currently 5.8 per cent.
Alongside this, there will be some added protection in the form of an increase in transitional annual relief cap that will be set at 30 per cent.
Many businesses will have limited time to budget, given how late in the day the Rating List was published.
This is why further revisions in the Spring Statement are unlikely.
Instead, businesses should seek professional financial support in order to mitigate the impact of these changes.
Our team can help you to understand how changing business rates can sit with your budget so that your business is better positioned for success in the coming year.
Prepare for business rate changes by speaking to our team today.
