300,000 Small Businesses to Pay No Rates for 12 Months
More than 300,000 small firms won’t pay business rates until September 2012, new government figures have revealed.
Under the Small Business Rate Relief (SBRR), firms with a rateable value of up to £6,000 will pay no rates until next September, while businesses with a rateable value of up to £12,000 will be eligible for a tapering level of relief.
Areas with high numbers of independent shops and businesses are most likely to benefit from the relief, the government statistics found — more than 10,000 businesses in Cornwall, nearly 6,000 in Bradford and 4,400 in Sheffield have received the discount.
The SBRR scheme was first launched last autumn to help small businesses get back on their feet following the recession. Rates are estimated to be the third-biggest outgoing for small firms after rent and staffing costs.
The Federation of Small Businesses (FSB) said the initiative had acted as a welcome cash injection for many small firms.
“At a time when confidence in business prospects is low and the Government is looking to the private sector to boost the recovery, small firms need as much help with their cashflow as possible.”
said FSB national chairman John Walker.
However, Walker added that business rate relief needed to be applied automatically if firms were really to benefit.
“The onus is now on councils to be creative and not needlessly make small businesses go through an application process when it is obvious they are eligible,” he said.
According to the Department for Communities and Local Government, the Localism Bill — currently going through Parliament — will scrap the requirement for firms to fill in an application for business rate relief, which will go some way towards making entitlement automatic. Councils are also to be given new powers to set business rates and give discounts to new enterprises.
- For further information see our business advice article on Rent Reviews and Rating Assessments where we discuss Understanding Rates.