Rateable value and transitional arrangements

Apart from properties that are exempt from business rates, each non-domestic property has a rateable value which is set by the valuation officers of the Valuation Office Agency (VOA), an agency of Her Majesty’s Revenue and Customs. They draw up and maintain a full list of all rateable values,

The rateable value of your property is shown on the front of your bill. This broadly represents the yearly rent the property could have been let for on the open market on a particular date. For the 2023 revaluation that came into effect on 1 April 2023, this date was set as 1 April 2021. 

The valuation officer may alter the value if circumstances change. The ratepayer (and certain others who have an interest in the property) can appeal against the value shown in the list if they believe it is wrong. Full details on your rights of appeal are available from the Valuation Office Agency. The Council can only backdate any business rates rebate to the date from which any change to the list is to have an effect.

The Valuation Office Agency will continue to fulfil its legal obligations to alter rating assessments if new information comes to light indicating the valuation is inaccurate.

Further information about the grounds on which appeals may be made and the process for doing so can be found at www.gov.uk or obtained from your local valuation office.

Transitional Arrangements

Revaluations make sure each ratepayer pays their fair contribution, by ensuring that business rates paid by any one ratepayer reflects changes over time in the value of their property relative to others. Rateable values are the amount of rent a property could have been let for on a set valuation date. For the 2023 revaluation, that date was 1 April 2021.

All regions have seen their total rateable value increase in percentage terms, but London has not seen an overall increase as large as in other areas. The total increase across England was 7.3%, but in London, it was only 3.3%. The small business multiplier for 2024/25 remains at 49.9 pence in the pound and the standard multiplier has increased by 6.7% to 54.6 pence in the pound. 

For ratepayers who saw a reduction in rateable value from 1 April 2023 there will be no downward transitional arrangements. These ratepayers will benefit from the full reduction in rateable value from 1 April 2023. For those ratepayers seeing an increase in rateable value there will be transitional arrangements to phase in those increases over the following years. 

For small properties with an (RV up to £28,000), the increase in rates bill is capped at 5% for 2023/24 and 10% for 2024/25. 

For medium-sized properties (RV £28,001 to £100.000) the increase is capped at 15% for 2023/24 and 25% for 2024/25. 

For large properties with an (RV over £100,000), the increase is capped at 30% for 2023/24 and 40% for 2024/25. 

Changes in rateable value differ from one business sector to the next. The retail sector in London has seen reductions, whereas the industrial sector has seen increases. Of all the outer London boroughs, Kingston has experienced the greatest reduction in the rateable value of retail properties; a reduction of 21%. This is a stark comparison to the average 43% increase in the rateable value of industrial properties. Kingston sees the highest increase in office space rateable values across the whole of London at 27%. Other sectors in Kingston average a rateable value increase of 3%.

Other Business Rates changes from 1 April 2024

The Government has announced an extension to the existing retail, hospitality & leisure discounts. The 75% discoutn will continue from 1 April 2024 to 31 March 2025. This will be capped to a maximum reduction of £110,000.

Businesses that stop qualifying for small business rate relief because of a rateable value increase will qualify for the supporting small business rate relief. This caps the annual increases in rate liability to a maximum of £600 per annum over the next three years.

Properties that experience an increase in rateable value after having undergone improvements, will qualify for a one-year rate relief from any rate increase beginning in April 2024 through to April 2028.