Contents
- 1. Overview
- 2. How your business rates are calculated
- 3. Types of business rates relief
- 4. Self-Catering Properties
- 5. Recent Updates
1. Overview
Non Domestic Rates (NDR) are also known as business rates and are taxes to help pay for local services. These are charges on most non domestic properties. If you pay business rates, your property may be eligible for business rates relief.
Some premises will be exempt from business rates, while others may qualify for:
- the retail, leisure and hospitality rates relief scheme
- the small business rates relief scheme
- the charitable and non-profit organisations rates relief
- relief on empty properties
Local authorities can also grant hardship relief to businesses if they believe that it is in the interests of the local community to do so.
2. How your business rates are calculated
Your business rate is calculated by taking the Rateable Value (RV) of your property and multiplying it by the current non domestic rates 'multiplier' (or 'poundage'). The Valuation Office Agency (VOA) values properties and assigns the RV. You can appeal against its RV if you think it is incorrect.
For 2023-24 the Welsh Government has frozen the multiplier, resulting in no increases in bills. For the financial year 2023-24 the multiplier is 0.535.
Appeals against property valuations
If you want to appeal contact the VOA. If you and the VOA cannot reach agreement, the VOA must pass your appeal to the Valuation Tribunal for Wales (VTW).
3. Types of business rates relief
Properties exempt from business rates include:
- agricultural land and buildings including fish farms
- buildings used for training or the welfare of disabled persons
- buildings registered for public religious worship and church halls
You can find a list of the exempt types of property in Schedule 5 of the Local Government Finance Act 1988.
Retail, Leisure and Hospitality Rates Relief
All applications for relief should be made to your local authority. Links to the relevant local authority application forms are available here.
In 2023-24, the Welsh Government will provide £140m of targeted non-domestic rates support to businesses in the retail, leisure and hospitality sectors.
Businesses will be eligible for 75% off their liability for the financial year. The amount of relief under the Welsh Government’s Retail, Leisure and Hospitality Rates Relief scheme will be capped at £110,000 per business across Wales.
It will be for local authorities to determine how they wish to administer the scheme to maximise take-up and minimise the administrative burden for ratepayers and for local authority staff.
Local authorities are responsible for providing businesses with clear and accessible information on the details and administration of the scheme.
View guidance here on Retail, Leisure and Hospitality Rates Relief in Wales for 2023-24.
Transitional Relief
From 1 April 2023, following the revaluation, the Welsh Government is providing all ratepayers whose liability is increasing by more than £300, as a consequence of revaluation, with transitional relief. Any increase in non-domestic rates liability as a result of revaluation will be phased in over two years.
A ratepayer will pay 33% of their additional liability in the first year (2023-24) and 66% in the second year (2024-25), before reaching their full liability in the third year (2025-26). The Welsh Government is providing £113m over two years to fund this relief, supporting all areas of the tax-base through a consistent and straightforward transitional scheme.
Guidance for Transitional Relief is available here
The following types of business will continue to get relief as follows:
Small Business Rates Relief in Wales
The Welsh Government provides non-domestic rates relief to eligible small businesses.
- eligible business premises with a rateable value of up to £6,000 will receive 100% relief; and
- those with a rateable value between £6,001 and £12,000 will receive relief on a tapered basis from 100% to zero
Download full guidance on Small Business Rates Relief in Wales.
Registered Childcare Premises
Registered childcare providers receive 100% relief until 31 March 2025, during which time it will be evaluated to assess its effect.
Post Offices
- Post offices with a rateable value up to £9,000 receive 100% relief
- Post offices with a rateable value between £9,001 and £12,000 receive 50% relief
Multiple Occupation Limit
Where a ratepayer is liable for more than two properties on a single local non-domestic rating list (“local list”), and those properties meet only the rateable value conditions, the ratepayer will only receive relief for a maximum of two such properties.
Hydropower Projects
We are providing grants to help eligible community owned hydropower projects with their business rates. Hydropower projects extract energy from water courses to generate electricity. Community owned hydropower projects with a rateable value up to £50,000 can apply for support towards their 2023-24 business rates. For more information contact EnergyPolicyMailbox@gov.wales
Charitable Rates Relief
If your property is occupied by a registered charity or community amateur sports club, and used for charitable purposes, you automatically qualify for 80% mandatory rates relief.
You may qualify for relief of up to 100% at the discretion of the local authority if your property is occupied by a non-profit making body and used for purposes which are:
- charitable
- philanthropic
- religious
- educational
- to do with social welfare
- scientific
- to do with literature
- to do with the fine arts
- to do with recreation by a not-for-profit club or society
Further information on charitable rate relief can be found in this guidance.
Rates relief for empty properties
Empty business properties are exempt from paying business rates for 3 months after the property becomes unoccupied.
There are additional exemptions for certain types of property or for properties under a set rateable value. These include:
- industrial premises, such as warehouses, which are exempt for a further 3 months
- listed buildings which are exempt until they become occupied again
- buildings with a rateable value under £2,600 which are exempt until they become occupied again
- properties owned by charities, which are exempt if the property's next use is likely to be wholly or mainly for charitable purposes
- community amateur sports club buildings which are exempt if their next use is likely to be wholly or mainly for a sports club
- a business whose owner is a company which is subject to a winding-up order made under the Insolvency Act 1986 or which is being wound up voluntarily under that Act
- a business whose owner is a company in administration within the meaning of paragraph 1 of Schedule B1 to the Insolvency Act 1986 or is subject to an administration order made under the former administration provisions within the meaning of article 3 of the Enterprise Act 2002 (Commencement No. 4 and Transitional Provisions and Savings) Order 2003.
- a business whose owner is entitled to possession only in his or her capacity as the personal representative of a deceased person.
After the exemption period ends, you will be liable for the full business rate bill.
You should notify your local authority when your property becomes vacant and also when it becomes re-occupied.
This link provides further information.
Hardship relief
Local authorities can also grant hardship relief to businesses if they believe that it is in the interests of the local community to do so. For more information on hardship relief contact your local authority.
Guidance on how local authorities should apply the relief can be found here.
4. Self-Catering Properties
If your property is in Wales and is commercially available to let as a self-catering property, provided certain criteria are met it will be rated and valued for non-domestic rates. The Valuation Office Agency (VOA) works out the rateable value based on the property type, size and location.
From 1 April 2023 in Wales, self- catering property is non-domestic and therefore liable for non-domestic rates, if the VOA is satisfied that:
- it will be available for letting commercially as self-catering accommodation for short periods totalling 252 days or more in the following 12 month period
- the ratepayer’s interest in the property enables them to let it for such periods
- in the 12 months prior to assessment it has been available for letting commercially as self-catering accommodation for short periods totalling 252 days or more
- the short periods it has actually been commercially let for amounted to at least 182 days during that period
In addition:
- businesses consisting of several self-catering properties at the same location or within very close proximity have the option to average the number of lettings days of the properties to meet the 182-day criterion where they are let by the same or connected businesses
You can find full guidance and advice on the rating of self-catering properties in Wales in this brochure.
5. Recent Updates
The Welsh Government will periodically be publishing a Bulletin setting out recent non-domestic rates developments.