Business rates holiday and cash grants for retail, hospitality and leisure businesses - coronavirus
25 March 2020: there is a business rates holiday for the 2020-21 tax year, as well as and cash grants, for retail, hospitality and leisure businesses.
|OFFICIAL GUIDANCE:||Business Rates: Expanded Retail Discount|
Key features of the scheme
- Two reliefs are available for businesses in the retail, hospitality and leisure sectors:
- A holiday from business rates for the 2020-2021 tax year. This applies to all businesses in these sectors.
- Cash grants of £25,000. These will be given to businesses in these sectors with rateable value between £15,000 and £51,000 (in England). Small businesses with a rateable value below £15,000 (in England) will receive a cash grant of £10,000.
- The reliefs will be administered by local authorities. Cash grants will be paid automatically. In Scotland, businesses will need to apply.
- Businesses will receive a bill showing no business rates charge for the 2020-2021 tax year. Those who had already received bills for the 2020-2021 tax year will be rebilled.
Eligibility and additional features
- To be eligible for these schemes, businesses must be in the retail, hospitality and/or leisure sector. That means they must be ‘wholly or mainly being used’:
- as shops, restaurants, cafes, drinking establishments, cinemas and live music venues,
- for assembly and leisure; or
- as hotels, guest & boarding premises and self-catering accommodation.
- Each individual "hereditament" is eligible for the holiday and cash grant. Businesses with multiple premises will qualify for each of their hereditaments that meets the above criteria.
- Decisions about granting reliefs will be taken by local authorities, following government guidance.
- In many cases it will be obvious that a business qualifies. However, for certain types of business careful consideration of the criteria is necessary. Some businesses are expressly excluded from the reliefs. The detailed criteria for England are set out in government guidance on the expanded retail discount.
- Eligibility is based on rateable values recorded on the rating list at 11 March 2020. Subsequent changes to the rating list will be disregarded. However, where it was "factually clear" that the rating list was "inaccurate" then local authorities have the discretion to award (or withhold) the holiday/cash grant. It is not clear how inaccuracies are expected to be evidenced, but it seems this is intended to be limited to "manifest errors of fact rather than matters of valuation judgment.
- Premises that are occupied but not wholly or mainly used for the purposes above will not qualify for the relief.
- Premises occupied for "personal use" will not qualify. Beach huts, moorings and private stables are given as examples. Car parks and parking spaces do not qualify.
- Premises which have closed temporarily due to the government’s advice on COVID-19 will be treated as occupied for the purposes of this relief.
- Cash grants will be sent to the person named as the ratepayer in the local authority’s records on 11 March 2020. Landlords and managing agents are encouraged to help identify the ratepayer for properties they manage. Funds received by third parties can be recovered if that person was not the ratepayer on 11 March 2020.
- Business rates are a devolved tax and different rules can apply in England, Wales, Scotland and Northern Ireland. The eligibility criteria above are based on the guidance for England and may apply differently elsewhere in the UK. However, all UK administrations are offering a payment holiday for the 2020-2021 tax year for retail, leisure and hospitality businesses. Different thresholds apply for the cash grant schemes:
£10,000 cash grant
Rateable value/ net annual value
£25,000 cash grant for retail, leisure & hospitality England £0 - £15,000 £15,001 - £51,000 Wales £0 - £12,000 £12,001 - £51,000 Northern Ireland £0 - £14,999 £15,000 - £51,000 Scotland £0 - £18,000 £18,001 - £51,000
- In Scotland all non-domestic rate payers will get 1.6% rates relief for the 2020-2021 tax year. This will be applied automatically to bills. In Northern Ireland, all businesses will pay zero rates for April, May and June 2020. This applies automatically and does not need to be repaid.
- Businesses should contact their local authority with any questions they may have about the scheme.
- Government guidance on the grant schemes is available here.