Small Business Rate Relief – could you be entitled?

Nearly half of the small firms quizzed in a recent survey know they can claim Small Business Rate Relief (SBRR) from their local council but the study also showed huge numbers remain in the dark about how to apply.

The Federation of Small Businesses polled members and discovered 49% didn't know it was their local authority with the power to grant the relief, which can run in to thousands of pounds.

A further 29% of respondents said they were aware but only 22% were actually in receipt of SBRR.

Under the current relief arrangements, eligible ratepayers pay no rates on properties with rateable values up to £6,000, with a tapered relief between 100% and 0% for properties with rateable values between £6,001 and £12,000. The relief is, however, not applied automatically and has to be applied for individually.

Richard Gregg, the FSB's Regional Chair for Manchester & North Cheshire, said: "If almost half the of the businesses we polled are unaware councils can grant SBRR, then the authorities need to up their game when it comes to promoting it, especially as businesses have to apply for it. If all eligible firms in the region were applying and getting the relief they are entitled to, that would be a huge saving for many small business owners to invest back in other areas.

The FSB submitted Freedom of Information request with local authorities in Greater Manchester and North Cheshire to get a better understanding of how councils were managing SBRR. Only Bury Council was able to answer all four questions. Other councils either didn't record the data, or said it was exempt from FOI on cost grounds.

In Bury's case it showed 356 businesses in the authority area applied for SBRR between January and September this year. In total, 284 of those requests were granted, which amounted to £519,752 of relief.

The Federation's FOI request also sought to ascertain how councils were promoting the relief scheme to businesses in their area. All said they were doing this, with the most common promotional methods cited as either posting details on council websites and/or issuing guidance leaflets with annual bills.

We would urge all small business owners to make some time to check whether they are eligible for SBRR. If you would like to speak to someone quickly for advice on SBRR then you can email me at: stuart.hicks@dunlopheywood.com.

SBRR at a glance:

This relief is aimed at helping small businesses where they are not entitled to another mandatory relief.

Relief is based on the rateable value (RV) of your business in the relevant valuation period. You can apply for relief for the current period up to September 2015 and relief is granted for a maximum of 18 months.

Who qualifies?

Businesses that occupy only one property in England and have a rateable value (RV) of less than £12,000.

Businesses may qualify if they occupy one main property and other additional properties, providing that: The additional properties do not have individual RVs of more than £2,599; and the combined RV of all the properties is under £18,000.

Businesses receiving SBRR that take on an additional property which would currently disqualify them, will continue to receive that relief for 12 months.

Small business rate relief is funded by a supplement added to all other rates bills. However, if your property has a rateable value above £12,000 but below £18,000, your bill has already been calculated using the lower small business multiplier. This means that although you are not entitled to the relief, you will not have to pay the supplement.

How much Relief will you get?

Relief is on a sliding scale:

Properties with a rateable value of up to £6,000 get 100% relief. For properties with an RV of between £6,000 and £12,000 relief goes down gradually fro 100% at £6k to 0% at £12k.

Making a claim:

You need to apply to get relief.
Apply by September 2015.

Your rateable value (RV) has been reduced from over £18,000 to under £18,000, you must apply within one month of the day you are served with notice of the RV reduction.

If you do not apply within these timescales you will not receive SBRR.

How to apply:
Click here to download a small business rate relief claim form.