Recent Changes to Non-Domestic Rates (NDR) Explained

Quick Answer: Non-domestic rates (also called business rates) are a tax on commercial properties in the UK, calculated by multiplying a property's rateable value by a government-set multiplier. Recent changes include more frequent revaluations, updated multipliers for 2025/26, reformed rate reliefs for small businesses, and new digital tools for managing and appealing rates.

What Are Non-Domestic Rates (Business Rates)?

Non-domestic rates — commonly known as business rates — are a tax on properties used for commercial purposes in the UK. They apply to offices, shops, factories, pubs, and other non-residential properties.

How they work, in brief:

• The Valuation Office Agency (VOA) assigns each commercial property a rateable value — an estimate of its annual open market rental value
• The government sets an annual multiplier (pence per pound of rateable value)
• Your bill = Rateable Value × Multiplier, minus any eligible reliefs
• Funds collected go to local councils to pay for public services

Business rates are the commercial equivalent of council tax. They are set by central government but collected by local authorities.

Who Pays Business Rates in the UK?

The occupier of a commercial property is responsible for paying business rates. If a property is empty, the owner typically becomes liable after a short exemption period.

You generally need to pay business rates if you occupy:

• An office, shop, or retail unit
• A factory, warehouse, or industrial unit
• A pub, restaurant, or hospitality venue
• Any other non-domestic or mixed-use property

You may be exempt if your property is:

• Agricultural land or buildings
• Used exclusively for charitable purposes
• Below the rateable value threshold for Small Business Rate Relief (SBRR)

What Is Rateable Value — and Who Sets It?

Rateable value is the estimated open market annual rental value of your commercial property on a set valuation date. It is assessed by the Valuation Office Agency (VOA), an executive agency of HMRC.

Rateable value is not your actual rent — it's a standardised estimate used to calculate what you owe in business rates. The VOA revalues all non-domestic properties periodically to keep values aligned with current market conditions.

Why rateable value matters:

• It determines how much you pay in business rates
• It affects which multiplier applies to your property
• It determines your eligibility for Small Business Rate Relief
• You can appeal it if you believe it's incorrect

What Are the Recent Legislative Changes to Business Rates?

The UK government has introduced several significant changes to the non-domestic rates system in recent years. Here's a summary:

What Are the Current Business Rates Multipliers?

The multiplier is the figure you apply to your rateable value to calculate your annual rates bill. There are two multipliers: one for small businesses and one standard rate.

Business Rates Multipliers (England) — 2018 to 2026

Tip: Most businesses with a rateable value under £51,000 qualify for the small business multiplier.

How to Calculate Your Business Rates

Formula: Rateable Value × Multiplier = Business Rates Payable (before reliefs)

Worked Example — Small Serviced Office in Manchester

Tip: Always verify your rateable value and multiplier via the VOA website.

What Business Rate Reliefs and Exemptions Are Available?

Several reliefs can significantly reduce — or eliminate — your business rates bill. Here's a breakdown of the main options:

Small Business Rate Relief (SBRR)

Important: If you occupy multiple properties, eligibility may be affected. Always check the latest rules with your local council.

Empty Property Business Rate Exemptions

Other Available Reliefs

• Transitional relief — phases in large rate increases following a revaluation
• Retail, hospitality & leisure relief — sector-specific support (subject to annual government announcements)
• Charitable rate relief — up to 80% mandatory relief for registered charities
• Rural rate relief — for businesses in designated rural areas
• Green technology exemptions — businesses adopting qualifying sustainable technologies may receive further relief

What Is Transitional Relief and How Does It Work?

Transitional relief is a scheme that limits how sharply your business rates bill can increase following a revaluation. It phases in higher bills over a set period rather than applying them all at once.

Example: How Transitional Relief Phases In a Rate Increase

This gives businesses time to adjust their budgets as property values are updated.

How Do You Apply for Business Rates?

To register for business rates and apply for any available reliefs, contact your local council directly. Most councils offer online applications.

Step-by-Step: Applying for Business Rates

1. Determine if your property is liable — check property type and any exempt categories
2. Find your rateable value — search via the VOA portal
3. Identify your local council — billing is handled by the council where your property is located
4. Complete the application — most councils have online forms; submit with proof of occupancy and property details
5. Apply for reliefs separately — SBRR and other reliefs are not applied automatically; you must claim them
6. Monitor your bill — check for accuracy each year, especially after a revaluation

Important: Relief is not applied automatically. You must apply through your local council.

What Is the Valuation Office Agency (VOA) and What Does It Do?

The Valuation Office Agency (VOA) is an executive agency of HMRC responsible for assessing the rateable value of all non-domestic properties in England and Wales.

The VOA's key functions:

• Sets and updates rateable values for all commercial properties
• Conducts periodic revaluations to reflect market rental conditions
• Manages the Check, Challenge, Appeal (CCA) process for disputed valuations
• Provides online tools for businesses to view and query their assessments

How Do You Appeal a Business Rates Valuation?

If you believe your rateable value is incorrect, you can challenge it through the VOA's Check, Challenge, Appeal (CCA) process.

Steps to Appeal Your Rateable Value

1. Check — Review your property's details on the VOA portal and report any factual inaccuracies
2. Challenge — If you believe the valuation itself is wrong, submit a formal challenge with supporting evidence (e.g. comparable rents for similar properties)
3. Appeal — If your challenge is rejected, escalate to the independent Valuation Tribunal for England (VTE)

Key tips for a successful appeal:

• Act promptly — there are deadlines at each stage
• Use comparable property data to support your case
• Keep records of all correspondence with the VOA
• Consider engaging a professional rating adviser for complex cases

How Do You Pay Business Rates?

Business rates are billed annually by your local council and can be paid in monthly instalments (usually 10 or 12 payments per year).

Available Payment Methods

What Happens If You Don't Pay Business Rates?

Non-payment of business rates can result in surcharges, enforcement action, and in serious cases, insolvency proceedings.

Consequences of late or non-payment:

• Interest and surcharges added to outstanding amounts
• Council may issue a reminder, then a final notice
• Liability order obtained through magistrates' court
• Enforcement agents (bailiffs) may be instructed to recover assets
• In extreme cases, winding-up proceedings for limited companies

If you're struggling to pay, contact your local council early — they may offer a payment arrangement.

💼 Business Rates at Method Spaces, Portland Plaza – What Tenants Need to Know

One of the biggest financial advantages of taking a serviced office at Portland Plaza, 109 Portland Street, Manchester is that many of our units currently qualify for 100% business rates relief under the Small Business Rates Relief (SBRR) scheme.

This means eligible tenants may pay £0 in business rates — a significant saving on top of already startup-friendly office costs.

📌 Important: Relief Is Not Applied Automatically

While our units meet the eligibility criteria, it's the tenant's responsibility to apply for relief through Manchester City Council. The process is straightforward, but it must be done directly by the business occupying the space.

Ready to Save on Office Costs?

If you're looking for an affordable, professional workspace in the heart of Manchester — with the potential to pay £0 in business rates — our units at Portland Plaza, 109 Portland Street could be the perfect fit.

📞 Contact us today to learn more

📅 Book a tour to see the space in person

Get in touch now and discover how much you could save with a serviced office that works for your business.

Key Takeaways: Business Rates in the UK

• Business rates are calculated as: Rateable Value × Multiplier = Rates Payable
• The VOA sets rateable values; local councils collect payments
• The 2025/26 multipliers are 55.5p (standard) and 49.9p (small business)
• Businesses with rateable values under £12,000 can qualify for 100% relief
• Relief is not automatic — you must apply through your local council
• You can challenge your rateable value via the VOA's Check, Challenge, Appeal process
• Transitional relief protects businesses from sudden large rate increases after revaluations
• Serviced offices at Method Spaces, Portland Plaza may qualify tenants for £0 business rates

Sources:

https://www.gov.uk/introduction-to-business-rates

https://www.gov.uk/apply-for-business-rate-relief/small-business-rate-relief

https://www.takepayments.com/blog/business-growth/what-are-business-rates/