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Spring Budget 2017 update

Legislative changes

The government has clarified that no legislative changes are required because they expect billing authorities to to deliver the relief via their local discretionary relief powers.

This means that local authorities need to formally adopt the scheme, and each authority may have different mechanisms and timescales to achieve this. Local authorities also need the detailed criteria from the government before adopting the schemes.

Support for small businesses

The government has provided guidance for simple cases. Further guidance for complex cases and future years is to follow. The government also acknowledges that billing authorities are likely to need software changes to implement the scheme.

Initial guidance on eligibility and the amount of relief available:

The supporting small businesses relief will help those ratepayers who as a result of the change in their rateable value at the revaluation are losing some or all of their small business or rural rate relief and, as a result, are facing large increases in their bills.

To support these ratepayers, the supporting small businesses relief will ensure that the increase per year in the bills of these ratepayers is limited to the greater of:

  • a cash value of £600 per year (£50 per month). This cash minimum increase ensures that those ratepayers currently paying nothing or very small amounts are brought into paying something, or

  • the matching cap on increases for small properties in the transitional relief scheme.

In the first 2 years of the scheme, this means all ratepayers losing some or all of their small business rate relief or rural rate relief will see the increase in their bill capped at £600. The cash minimum increase will continue to stay flat in each year. This means that ratepayers who are currently paying nothing under small business rate relief and are losing all of their entitlement to relief (i.e. moving from £6,000 rateable value or less to more than £15,000) would under this scheme be paying £3,000 by year 5.

Those on the supporting small businesses relief scheme whose 2017 rateable values are £51,000 or more will not be liable to pay the supplement (1.3p) to fund small business rate relief while they are eligible for the supporting small businesses relief scheme.

Ratepayers remain in the supporting small businesses relief scheme for either 5 years or until they reach the bill they would have paid without the scheme. A change of ratepayers will not affect eligibility for the supporting small businesses relief but eligibility will be lost if the property falls vacant or becomes occupied by a charity or Community Amateur Sports Club.

There will be no 2nd property test for eligibility for the supporting small businesses relief scheme. However, those ratepayers who during 2016/17 lost entitlement to small business rate relief because they failed the 2nd property test but have, under the rules for small business rate relief, been given a 12 month period of grace before their relief ended can continue on the scheme for the remainder of their 12 month period of grace.

We have written to all the ratepayers that we believe may qualify for this scheme based on the information currently available.

Support for pubs

The government will consult on the criteria regarding this scheme.

We have written to all the ratepayers that may qualify for this scheme based on the limited information currently available.

Discretionary Business Rates Support Scheme

The government is currently consulting on the design of the scheme, and allocation of the funds.

They have set out some expectations of the scheme:

  • It will be for billing authorities to design their discretionary relief schemes and determine the eligibility of ratepayers for support. The schemes must clearly set out the criteria that ratepayers across the local authority area, or within specific locations within their areas need to meet in order to qualify for discretionary relief.

  • Authorities must ensure in the conditions of the award that they can recalculate the relief in the event of a change to the rating list for the property concerned (retrospective or otherwise).

  • State aid may apply

  • If a property is eligible for discretionary relief under schemes for which section 31 grant is payable - for example, "new empty property" relief, or "local newspaper relief" - authorities should first award relief under those schemes and claim section 31 grant funding in the normal way. Only having awarded relief under those schemes, should they then award additional relief for "revaluation support" in accordance with local schemes.

  • The government proposes placing conditions on the section 31 grants they give to authorities. The conditions will require authorities to use the grant to support only ratepayers facing an increase in their bills following revaluation; and to require billing authorities to consult their major precepting authorities and, where appropriate, combined authorities, before adopting any discretionary relief support scheme.

As there is considerable work to do regarding this support scheme, we are unable to provide any additional information yet. However, a general discretionary 'Hardship Relief' scheme does exist and any ratepayers facing hardship in the meanwhile may wish to submit an application under this scheme.

July 2017 update

Following the 2017 General Election, we have received more information about these schemes. We are now working on the detail needed to formally adopt the schemes. 

If we wrote to you specifically in March about Support for Small Businesses or Support for Pubs, and you continue to have a liability for at least part of 2017/18, then we will write to you again once the schemes have been adopted.

October 2017 update

We have adopted both the Pub Relief scheme and Supporting Small Businesses scheme and contacted everyone we have identified as being eligible.

If, having read the schemes, you believe you are eligible, and we have not contacted you, please email brates@guildford.gov.uk.

We are working on defining and adopting a Discretionary Business Rates Support Scheme. Any relief will be backdated to 1 April 2017 and we will publish further information once our scheme is in place.