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Business rates April 2026

Business Rates as of April 2026

The way business rates are calculated is undergoing its most significant change in decades, designed to create a fairer, more modern system. These reforms, announced by the UK Government, will take effect from 1 April 2026.

We urge all businesses in Rugby to understand how these changes will affect your rateable value and subsequent bills.
 

The 2026 revaluation: New rateable values (RVs)

Every three years, the Valuation Office Agency (VOA) reassesses the Rateable Value (RV) of all non-domestic properties in England and Wales. The new 2026 Rating List will be based on property rental values as of the Valuation Date of 1 April 2024.

•    What this means: Your new RV will reflect recent changes in the property market. If your sector/area has seen high rental growth since the last valuation in 2023, your RV may increase, and vice versa.
•    Actionable Step: You can now check your new, draft 2026 Rateable Value on the VOA website to begin planning your finances.

Your new Rateable Value (RV) is NOT your new business rates bill. Your bill is calculated by multiplying your RV by the relevant multiplier.
 

New system: the five-tier multiplier

From 1 April 2026, the current two-multiplier system will be replaced with a more differentiated five-tier system in England. This change is designed to provide targeted support to the high street and ensure larger operations contribute proportionately.

The new structure differentiates based on both Rateable Value (RV) and Sector.

New five-tier system
 

Multiplier Category Property Eligibility Criteria Draft Multiplier (2026/27 est.) Purpose
Small Business (Non-RHL) Non-Retail, Hospitality, Leisure (RHL) properties with RV below £51,000 Approx. 43.2p Lower rate for smaller firms outside RHL sector.
 
Small Business (RHL) Retail, Hospitality, and Leisure properties with RV below £51,000 Approx. 38.2p

Lowest rate to give high street/leisure permanent, specific support.

 

Multiplier Category Property Eligibility Criteria Draft Multiplier (2026/27 est.) Purpose
Small Business (Non-RHL) Non-RHL properties with RV £51,000 to £499,999 Approx. 48.0p Reduced from previous standard rate to reflect revaluation changes.
Small Business (RHL)

Retail, Hospitality, and Leisure properties with RV £51,000 to £499,999

 Approx. 43.0p Permanently lower rate to support medium-sized RHL venues.
High Value ALL properties with RV £500,000 and above Approx. 50.8p

Higher rate, often applied to large distribution centres and major sites, to fund RHL reductions.

 

Support schemes to phase in changes

To protect businesses facing sharp increases in their bills due to the Revaluation, the Government has introduced several support measures:

• Transitional Relief Scheme (TRS): This is a mandatory scheme that automatically caps the amount your bill can increase each year, phasing in large increases gradually over the 2026-2029 rating list period.

• Supporting Small Business Scheme (SSBS): This helps businesses that lose eligibility for Small Business Rate Relief (SBRR) due to a revaluation increase. It limits the annual increase to a fixed amount or percentage.

• Improvement Relief: This relief continues to apply, offering 12 months of 100% relief on any increase in RV due to qualifying physical property improvements.
 

What your business must do now

To ensure you are ready for 1 April 2026:

1. Check Your New RV: Visit the VOA’s official portal to find your draft Rateable Value for the 2026 list.

2. Verify Property Details: Log into your VOA account (if you have one) and ensure the physical details of your property are correct. If you believe the details are wrong, you can submit a 'Check' case via the VOA.

3. Contact Us: If you have questions about payment, relief eligibility, or your bill, contact Rugby Borough Councils’ Revenues team.

Valuation Office Agency (VOA) Rugby Borough Council
For: Rateable Value, Property Details, Valuation Appeals For: Rateable Value, Property Details, Valuation Appeals
Voa.gov.uk Rugby.gov.uk  Tel: 01788533488

 

Frequently asked questions (FAQ)


Q1: My Rateable Value (RV) has increased significantly. Does that mean my rates bill will also shoot up on 1 April 2026?

A: Not necessarily. Your final bill is protected by the Transitional Relief Scheme (TRS).

• The TRS automatically limits the amount your bill can increase each year, regardless of how large the change in your RV is. This ensures that large increases are phased in gradually over the 2026-2029 rating list period, providing stability.

• The actual bill increase is capped at a percentage (which varies by the size of your RV) for the first year. Your bill will automatically be adjusted if you are eligible.

Q2: You are moving from two multipliers to five. Doesn't this make the system more complicated, not "fairer" or "modern"?

A: We understand why it appears more complex. The change from two to five multipliers is designed to make the system more targeted and less blunt in who pays what, by formally recognising property use:

• The new system ensures that Retail, Hospitality, and Leisure (RHL) businesses receive a permanently lower tax rate than other business types. Previously, this support was a temporary annual discount.

• It introduces a High-Value Multiplier for the largest properties (RV >£500,000), which allows the burden to be shifted slightly away from the majority of smaller and medium-sized properties.

• This approach is intended to provide a permanent tax cut for the high street, funded by a proportional increase on the very largest distribution and corporate sites.

Q3: How is the Transitional Relief scheme actually funded? Am I paying for someone else's relief?

A: This is a crucial point regarding transparency. The Transitional Relief Scheme is partially funded by a temporary, small increase applied to the multiplier for all ratepayers who do not qualify for the relief (i.e., those who are not subject to a large increase in their bill).

• The Government has introduced a 1 pence (1p) Transitional Relief Supplement (TRS) which is added to the relevant multiplier for one year, starting on 1 April 2026.

• This supplement helps fund the cap on increases for those who see a large jump in their Rateable Value.

• Crucially: You will not pay this 1p supplement if your property is eligible for Transitional Relief or the Supporting Small Business Scheme (SSBS).

Q4: My business qualifies for the Retail, Hospitality, and Leisure (RHL) multipliers. Does that mean I'm also eligible for Small Business Rate Relief (SBRR)?

A: Eligibility for the lower RHL multipliers is separate from eligibility for SBRR.

• RHL Multiplier: This applies to your property if it is wholly or mainly used for a qualifying RHL purpose, and its RV is below £500,000. This is a permanently lower tax rate (e.g., 38.2p instead of 43.2p for small businesses).

• SBRR: This is a relief (a reduction in your bill) that provides 100% discount for properties with an RV of £12,000 or less, tapering down to 0% for properties up to £15,000.

• If you qualify for both, the lower RHL multiplier is used in the calculation, and then SBRR is applied to reduce the final bill.
 

Q5: I disagree with the new Rateable Value (RV) set by the VOA. How do I challenge it?

A: The process for challenging your valuation is managed entirely by the Valuation Office Agency (VOA), which is an agency of HMRC, not the Council. You must use the VOA's Check, Challenge, Appeal (CCA) process:

1. Check: Review the VOA's details and submit a 'Check' query if you believe the factual details of your property are incorrect.

2. Challenge: If you still disagree with the RV after the VOA has responded to your 'Check', you can submit a 'Challenge'.

3. Appeal: If the 'Challenge' is unsuccessful, you can appeal to the Valuation Tribunal.

You can begin by finding your property and logging into the VOA's service here: voa.gov.uk
 

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