Small Business Rate Relief
Introduction
Small Business Rate Relief (SBRR) was introduced from 1st April 2005. It is intended to reduce the burden of non-domestic rates. It is available, subject to certain criteria, to those who occupy non-domestic hereditaments (not just businesses).
Who qualifies?
In order to qualify, the ratepayer must occupy either
- One hereditament with a rateable value below £10,000 or
- Occupy one 'main' hereditament and additional hereditaments provided each subsequent hereditament has a rateable value below £2,200 and the total of all the rateable values are below £15,000. In these curcumstances relief is only available for the 'main' hereditament.
- The hereditament(s) may be located anywhere in England NOT just South Kesteven.
- The hereditament with a rateable value between £10,000 and £14999 wiill fall within the "buffer zone".
What is a 'hereditament'?
Section 115 of the General Rate Act 1967 defines a hereditament as being, "a property which is or may become liable to a rate, being a unit of such property which is, or would fall to be, shown as a separate item in the valuation list". So, whilst an entry in the Rating List may be described as a factory, shop etc, it is properly refered to as a hereditament.
What do they qualify for?
The amount of relief is dependant upon the rateable value of the occupied hereditament. If the rateable value is below £5,000 then relief is set at 50% of the bill after the application of transitional phasing. Relief reduces on a sliding scale of approximately 1% for every £100 of rateable value up to £10,000.
Buffer Zone
The Government considered it unfair that one set of ratepayers would be entitled to relief whilst the other financed it without there being a 'gap' between the two. This 'gap' is refered to as the buffer zone and it contains those hereditaments with a rateable value between £10,000 and £14,999. A ratepayer may still make an application for SBRR and, provided the relevant qualifying criteria are met, they will be exempt from 'the supplement'.
What is 'The supplement'?
All hereditaments will have a supplement added to their rate bills in order to finance the scheme. Where there is entitlement to SBRR the supplement is removed.
The need for an application
The intention of the legislation is to target genuine small businesses, thereby excluding large organistations that occupy many small hereditaments. For this reason small businesses have to submit a fully completed application form, and declare they qualify in accordance with the relevant criteria. Anyone found to have made a false application shall be liable upon conviction to a Level Three fine (maximum £1,000), three month imprisonment or both.
There are two forms for you to download. For the Application form click here.
You must notify anychange in ratable value this is very important. It must be done within four weeks or you could lose any entitlement click here for the change form. Please note that you can download the forms, but not submit them electronically as they must have a signature on them.
Page Last Updated: November 26, 2008