Complete Guide to Business Rates Relief 2026

What Is Business Rates Relief?

Business rates relief is a reduction applied to your business rates bill by your local authority. Reliefs can reduce your bill partially or entirely, and some businesses with very low rateable values pay nothing at all.

There are several different types of relief, each with its own eligibility criteria. Some are applied automatically — your local authority adds them without you asking. Others require a formal application. Many businesses miss out on relief they are entitled to simply because they haven't applied.

The 2026 revaluation, which took effect on 1 April 2026, changed rateable values across England. This means some businesses have moved above or below relief thresholds, so it is worth reviewing your entitlement even if you have previously checked.

Types of Business Rates Relief — Overview

Click any relief below to jump to the full details.

Relief Checker — What Could You Be Entitled To?

Small Business Rate Relief (SBRR)

Small Business Rate Relief (SBRR) is the most significant relief available to small businesses in England. It can reduce your bill by up to 100% — meaning you pay nothing at all.

SBRR Thresholds (2026/27)

Even if you don't qualify for SBRR itself, properties with a rateable value below £51,000 automatically use the small business multiplier of 43.2p rather than the standard 48.0p — saving you money even without formal relief.

SBRR eligibility rules

• You must be the ratepayer (occupier) of the property
• The property must be your sole or main place of business
• If you occupy additional properties, each additional property must have a rateable value below £2,900
• The relief is based on the rateable value of your property on each day of the financial year

Retail, Hospitality and Leisure (RHL) Relief

From 1 April 2026, the previous RHL relief discount has been replaced by dedicated lower multipliers for qualifying RHL properties. This is a permanent structural change — rather than a temporary discount off your bill, RHL properties are now taxed at a fundamentally lower rate.

RHL multipliers 2026/27

What qualifies as RHL?

• Shops, retail outlets, and supermarkets
• Restaurants, cafés, bars, and pubs
• Cinemas, theatres, and music venues
• Hotels, guest houses, and self-catering accommodation
• Gyms, leisure centres, and sports facilities
• Estate agents and travel agents

Offices, warehouses, industrial units, and professional services do not qualify. If you're unsure, your local authority will confirm on your rates bill.

Transitional Relief

Transitional relief is designed to soften the impact of large changes in business rates bills following a revaluation. It caps how much your bill can increase year-on-year, phasing in rises gradually over the life of the rating list.

Following the 2026 revaluation, a new transitional relief scheme is in place. Properties that saw significant rateable value increases from April 2026 should have transitional relief applied automatically by their local authority.

How transitional relief works

• Applied automatically — you do not need to apply
• Caps the annual increase in your rates bill at a set percentage
• Applies for several years until your bill reaches its "full value"
• The specific caps for 2026/27 onwards are set by the government

Empty Property Relief

When a commercial property becomes empty, it receives a period of automatic rates relief before full rates become payable again.

Common strategies (and their limits)

Some landlords use short-term occupancy arrangements to "restart" the empty property relief period. HMRC and local authorities are familiar with these arrangements and may challenge them if the occupation is not genuine. Take professional advice before pursuing this approach.

Charitable and Non-Profit Relief

Registered charities and some other non-profit organisations are entitled to mandatory business rates relief of 80% on any property wholly or mainly used for charitable purposes.

Local authorities have the discretion to grant an additional top-up to 100% — known as discretionary charitable relief. This is not guaranteed but is worth applying for, particularly for smaller charities where rates represent a significant cost.

Who qualifies?

• Registered charities (must be registered with the Charity Commission)
• Community amateur sports clubs (CASCs) registered with HMRC
• Some other non-profit bodies — eligibility depends on the local authority

The property must be wholly or mainly used for charitable purposes. A charity occupying a property for commercial purposes unrelated to its charitable work may not qualify.

Rural Rate Relief

Businesses in qualifying rural areas with a population below 3,000 may be entitled to 100% rural rate relief if they are the sole provider of a particular service in that settlement.

Qualifying rural businesses

Discretionary Relief

Under Section 47 of the Local Government Finance Act 1988, local authorities can grant discretionary relief to any ratepayer, for any reason they consider appropriate in the interests of their area. This is a broad power and is used differently across different councils.

Common recipients include local sports clubs, community organisations, and businesses that provide significant local employment or public benefit. There is no automatic entitlement — applications are assessed on a case-by-case basis.

Hardship Relief

Local authorities can also grant hardship relief to businesses experiencing genuine financial difficulty, provided they are satisfied that it is in the interests of the local community to do so. This is rarely granted automatically and requires a formal application demonstrating hardship.

If your business is struggling to pay its rates bill, it is always worth contacting your local authority before the debt escalates. Many councils have discretionary powers to assist and would rather negotiate than pursue enforcement action.

Which Reliefs Are Applied Automatically?

What If Your Rateable Value Is Still Too High?

Relief reduces the bill calculated from your rateable value — but if the rateable value itself is wrong, relief only partially addresses the problem. A rateable value that is too high means you are overpaying on every penny of your bill, regardless of what relief is applied on top.

Following the 2026 revaluation, many rateable values were set using estimated comparable evidence. Errors are common — particularly for properties with unusual features, restricted use, or in locations that don't closely match available comparables.

If you believe your rateable value is too high, you can challenge it through the Check, Challenge, Appeal process. A successful challenge reduces your rateable value — and therefore your bill — permanently, not just for one year.