What is Business Rates?
Business rates are one of the most significant expenses that small businesses have to face in the UK. These rates, which are determined by the government, represent a tax on non-domestic properties such as shops, offices and factories. This means that business owners not only have to pay for their rent but also for their business rates.
What is Business Rates Relief?
Business rates relief, also known as small business rates relief or business rates discount, is a government scheme designed to help small businesses by reducing the amount of tax they have to pay for their non-domestic properties.
The discount for the retail, hospitality and leisure industries is 75%, the relief was introduced in the post-COVID era when the high-street economy was seriously struggling.
The relief allows small business owners to claim up to £110,000 and helps an average leisure business save up to £12,800 a year and it was originally a temporary measure that was going to end in April 2023.
How has Autumn Statement 2023 Affected Business Rates Discount?
One of the most talked-about announcements in the Autumn Statement 2023 was the extension of business rates relief for hospitality. This bold move by Jeremy Hunt has been welcomed by small business owners across the UK who were facing financial challenges due to the ongoing pandemic. The relief, which was originally set to end in April 2023, has now been extended for a further 12 months until April 2024.
The decision is strongly linked to freezing alcohol duty until August 2024 as the chancellor suggested that even having a pint in a pub became difficult for many.
What Does this Extension Mean for Your Business?
This extension of business rates relief means that small businesses in the hospitality industry will continue to benefit from a significant reduction in their tax bills, saving them thousands of pounds each year. This is particularly beneficial for those who are facing financial struggles due to the pandemic.
Moreover, this extension gives small business owners more time to recover from the impact of COVID-19 and provides them with a much-needed breathing space to get back on track. It also allows them to focus on reinvesting in their business and stimulating growth rather than worrying about high tax bills.
Eligibility for Business Rates Relief for Hospitality
If you own a business in the hospitality industry, such as a restaurant or a hotel, and your property has a rateable value of less than £51,000, then you may be eligible for business rates relief. It is important to check with your local council to see if you qualify for this scheme and how much relief you can claim.
In conclusion, the extension of business rates relief for hospitality is a positive move that provides much-needed support to small businesses in the UK, particularly those in the hard- hit hospitality industry. As UK Spirits Alliance pointed out "It`s most welcome news for hospitality and a great excuse to raise a toast!"
It not only helps them save money but also gives them the opportunity to focus on their recovery and growth.
