Small businesses have welcomed what they said were long overdue reforms to tax policy as the chancellor doubled business rate relief.
From April 2017, 600,000 small firms will not have to pay business rates, while 250,000 will pay lower rates.
Chancellor George Osborne unveiled the following changes that take effect from 1st April 2017
- Small Business Rate Relief (SBRR) will double permanently from 50% to 100%.
- Qualifying businesses with RV of £12,000 and below will receive 100% relief
- Qualifying businesses With RV Between £12,001 and £15,000 will receive tapered relief.
- Assessments of less than RV £51,000 will benefit from the ‘small’ multiplier.
From April 2020, the annual indexation of business rates multiplier will be switched from Retail Prices Index (RPI) to Consumer Prices Index (CPI).
The government will aim to introduce more frequent business rate revaluations (at least every 3 years) and will publish a discussion paper in March 2016.
Business rate bills in England to be standardised and ratepayers to have the option to receive & pay bills online by April 2017 and ensure that all local authority billing and collection systems link with HMRC digital tax accounts by 2022.
The government will consider the feasibility of replacing SBRR with a business rates allowance for small businesses.