Final details of a new scheme which is intended to reduce the rate bills of small businesses has been announced by the Government.
From April 2005 businesses in England occupying properties with a rateable value below £10,000 (£15,000 in London) will receive mandatory relief from rates.
Businesses occupying a property with a rateable value of £5,000 or less should see their rate bills reduced by 50 per cent, with relief tapering off to 0 per cent at £10,000.
But according to Mark Radford, Director of Rating at property advisers DTZ Debenham Tie Leung, the scheme is not all good news.
He said: "The proposed reduction in rate bills for small businesses is very welcome because rates are a disproportionate burden on the small business sector.
Although there are some restrictions on qualification, around 450,000 businesses can now look forward to receiving reduced rate demands from local councils.
"Unfortunately the new scheme will not be universally popular because the cost of small business rate relief will be met by increasing the rate bills of non - qualifying businesses.
"From April, any businesses occupying a property with a rateable value above £15,000 (£21,500 in London) will see a supplement of 1.6 per cent added to their rate bill to pay for the scheme.
I think many medium and larger businesses will feel the small business rate relief scheme should have been funded from the public purse rather than paid for by a new and additional tax on themselves.
"Many businesses are concerned that next year's revaluation, the small business supplement and the funding of business improvement districts from the rates will combine to send bills spiralling out of control.
However, as DTZ has proved over recent years, there are a number of steps that any business can take today to reduce the rates they pay."
If you have any queries or would like further advice regarding next year's revaluation or the small business supplement, contact Mark Radford in DTZ's Rating Department on 0121 697
