Scotland
Scotland
MULTIPLIERS
*Estimated increased based on projected CPI in the prevailing September (OBR 1.6% projected)
TRANSITIONAL ARRANGEMENTS
Following the revaluation of Business Rates effective from 1st April 2023, a new Revaluation Transitional Relief (RTR) has been introduced to offer protection to Business who have significant increases in their Rates liabilities. Where there is an entitlement, the relief will be automatically applied to a Non-Domestic Rates account and the following % limits on increase of rates payable will apply as follows:
For parks, or parts of parks, that existed but were not rateable on 31 March 2023, and which became rateable on 1 April 2023, Parks Transitional Relief will provide 33% relief.
SMALL BUSINESS BONUS SCHEME
With effect from 1st April 2023, the Small Business Bonus Scheme has been extended and reformed.
The thresholds have changed, and 100% Relief will be available for qualifying properties with an RV of up to 12,000, (previously 15,000).
The Upper threshold for individual properties to qualify has been extended from 18,000 to 20,000.
Cumulative Rateable Value Threshold of 35,000 is to remain in place.
From 1st April 2023, Car Parks, Car Spaces, Advertisement Hoardings and Betting shops will be excluded from eligibility
SMALL BUSINESS – TRANSITIONAL RELIEF
A Small Business Transitional Relief has been introduced to protect those losing or seeing a reduction in Small Business Bonus Scheme relief or Rural Rates Relief (including due to SBBS exclusions) on 1 April 2023, to ensure that properties that lose SBBS relief eligibility do so in a phased manner. The maximum increase in the rates liability relative to 31 March 2023 will be capped at £600 in 2023-24, rising to £1,200 in 2024-25 and £1,800 in 2025-26.
RURAL RATE RELIEF
Since 1st April 2017, 100% relief is available on your Business Rates if your property is in a designated rural area with a population below 3,000 and it is:
- A small food shop, general store, or post office with a rateable value below 8,500
- A small hotel, public house, or petrol filling station with a rateable value of up to 12,750
- Any other business providing a benefit to the community with a rateable value of up to 17,000
DISABLED RELIEF
Properties used for care, training or welfare of disabled persons may be eligible for up to 100% relief.
DAY NURSERY RELIEF+
As of April 2018, 100% relief from Business Rates is applied to all day nurseries. To get this relief your premises must only be used as a nursery school, or mainly as a nursery school. With effect from 1st April 2023 the Scottish Government have announced that this relief will be extended indefinitely.
ISLAND HOSPITALITY RELIEF
With effect from 1st April 2024, 100% Relief will be available in 2024-25 for properties in the hospitality sector on islands, as defined by the Islands (Scotland) Act 2018, capped at £110,000 per ratepayer.
CHARITABLE RATE RELIEF
Charities and amateur community sports clubs can apply for mandatory relief of up to 80% if a property is used wholly or mainly for charitable purposes. They may also qualify for additional discretionary relief+ of up to 20%. This is sometimes provided by Billing Authorities to top up certain reliefs to give charities and not-for-profit organisations extra help and remit any charge raised. If you run a non-profit recreation or sport club you’re not automatically entitled to relief, however the Billing Authority are able to grant discretionary relief of up to 100%.
ENTERPRISE AREA RELIEF
Businesses setting up or relocating to an Enterprise Area site and doing work in certain sectors may qualify for this rates relief, which offers up to 100% relief.
Enterprise Area relief, was due to end on 31 March 2024. This will be phased out over the next two years as set out in the below. This will offer a transitional period of support for those businesses who have been supported by this relief.
RENEWABLE ENERGY RELIEF SCHEME+
Since 1st April 2010, certain renewable technologies are eligible for rate relief of up to 100%. This relief is granted on a sliding scale based on the size of RV as shown on the table below.
From 1st April 2016, this relief was limited to only schemes incorporating community ownership. If your scheme has arrangements in place that entitle one or more community organisations to at least 15% of the annual profit, or so much of the annual profit as is attributable to 1 megawatt of the total installed capacity of the project (or more). To be eligible your scheme must produce heat or power from any of the following sources:
• Biomass • Biofuels • Fuel cells • Photovoltaics • Water (including waves and tides, but excluding production from the pumped storage of water) • Wind • Solar power • Geothermal sources
The generation activity should take place at the eligible property itself.
If you have more than one business property, the RV’s are combined.
Renewable energy will also benefit from the following:
- Cap rates bill increases at 12.5% for small hydro schemes
- 50% relief for district heating schemes
- 25% relief for Hydro schemes with total installed capacity of no more than one megawatt
New build properties may be eligible to receive relief for any new build renewable generation property that is built between 1st April 2016 and 31st March 2017. The property may be eligible to receive 10% rates relief if it has a RV up to 500,000 and 1.5% rates relief if above that figure. Since 1st April 2018, Principal Regulations have been updated to allow relief of 60% for new builds solely used for generation of renewable heat or power (or both) from including waves and tides but excluding pumped storage of water. This relief is only available if the RV value of the scheme is less than 5 million.
NEW FIBRE BROADBAND INFRASTRUCTURE
Any ‘New Fibre Broadband Infrastructure’ will be eligible for relief from 1 April 2019. This relief will be available for a period of 10 years and is available until 31st March 2034.
TELECOMMUNICATIONS MAST RELIEF
Telecommunications mast relief will be extended from 31 March 2029 to 31 March 2031.
DISTRICT HEATING RELIEF
From 1st April 2021 90% relief can be awarded on your Business Rates if your premises are only being used for a district heating network, or mainly being used for a district heating network.
This year the District Heating relief has been extended until 31 March 2027 and has also been expanded to include not only new networks, but all district heating networks, where at least 80 percent of the thermal energy generated derives from renewables.
PRESCRIBED PLANT AND MACHINERY EXEMPTION
Prescribed Plant and Machinery used for onsite renewable energy generation and storage will be exempt from rating from 1 April 2023 until 31 March 2025
UNOCCUPIED AND VACANT PROPERTIES
With effect from 1st April 2023 the Scottish Government are devolving the administration of Empty Property Relief (Including Listed Buildings) to Council and Local Authorities.
Legislation will be brought forward to empower Councils and Local Authorities to administer this effectively and provide a framework to develop localised schemes. Any ratepayer requiring information should contact the Council or Local Authority within where their property is located.
FRESH START RELIEF+
Properties in receipt of Fresh Start Relief on 31 March 2023 will continue to receive relief for the remaining duration of the relief, regardless of whether the new rateable value is above the qualifying threshold. From 1 April 2023, the rateable value up to which properties qualify for Fresh Start Relief will increase from £95k to £100k.
LOCAL RELIEFS+
Billing Authorities can grant local discretionary reliefs, however, there is no contribution towards these costs from Central Government. This contrasts with England where currently 25% - 50% is covered by Central Government.
BUSINESS GROWTH ACCELERATOR RELIEF
You might be able to get Business Growth Accelerator relief if:
- Your premises are a new build property
- You expand or make improvements to your property
The Government have announced that qualifying Ratepayers will be eligible for this relief for the 2019-20 rating year.
New build properties
- If your premises are a new build you won’t have to pay Business Rates until 12 months after the building was completed.
- Business Rates also do not have to be paid on new builds until they are occupied. New tenants will then qualify for business growth accelerator relief for 12 months.
Expanding or making improvements to your premises
- If you must expand or make improvements to your property, the Business Rates you are charged won’t change for 12 months.
- They will continue to be based on your old RV for this period.
From 1st April 2021, the Business Growth Accelerator Relief will be expanded to cover changes of use to support the reuse and regeneration of existing properties.
With effect from 1st April 2022 the Business Growth Accelerator relief extended to cover changes in use and regeneration of existing properties to include installation of Solar Panels.
With effect from 1st April 2023, Properties in receipt of Business growth Accelerator Relief on 31st March 2023 will continue to be eligible for an equivalent percentage of relief on the new rateable value for the remaining duration of the relief eligibility.
EXEMPTION (EXEMPTED BUILDINGS)
Agricultural Land and Buildings including fish farms, roads, public parks, properties used as places of religious worship or church halls, properties used for the training and / or welfare of disabled people and offshore properties are exempt. From 1st April 2017, all exemptions on deer forests and Estate shoots will be removed for the first time since 1995.
SELF-CATERING AND HOLIDAY LET ACCOMMODATION
In Scotland if your property is available to let for 140 days or more per year for short term lets, it will be treated as commercial rather than domestic and be rated as a self-catering property and valued for Business Rates instead of being valued and banded for Council Tax. Business Rates may be payable if you run a guesthouse or a more significant bed and breakfast for more than 6 people at any one time. Business Rates will be payable regardless of how many days your house or rooms are available to let.
+ Relief is subject to Subsidy Allowances under Article 3.2(4) EU-UK Trade and Cooperation Agreement by Subsidy Control. This allowance is 325,000 Special Drawing Rights, to a single economic actor over any period of three fiscal years, which is the equivalent of £335,000. The Subsidy Control Act 2022 will provide framework for the new UK wide Subsidy Control Regime.
2023 REVALUATION – INFORMATION REQUIRED BY THE ASSESSOR – FINES FOR ‘NON-RETURN’
The Scottish Assessor is entitled to serve notice requesting information such as rents, turnovers and costs on the following
- Any person who the Assessor thinks is a proprietor, tenant or occupier of the building that the Assessor is valuing (effectively all commercial buildings).
- Any other person who the Assessor thinks has the information which is reasonably required for their purpose
From 1st April 2020, a financial penalty can be imposed for failure to comply with any request made by the assessor. The level of fines for non-return of information are set out in the table below. These fines are cumulative and appear onerous.
TWO STAGE APPEAL PROCESS
From 1st April 2022, a new two-stage appeals system will be introduced to encourage earlier resolution of any disagreement between the Assessor and the proprietor, tenant or occupier without the need to use the formal appeals process. The reforms are also intended to speed up access to justice for those properties that continue to require an appeal hearing.
STANDARDISED BILL/RATE DEMAND
From the 1st April 2021, all local authorities across Scotland will be issuing rate demands using a standardised billing format, this is to improve consistency and transparency for all ratepayers.
OTHER BILLING, COLLECTION AND RECOVERY CHANGES
From 1st April 2021:
- Councils may request information from a proprietor, tenant or occupier. You must respond to this request within 21 days. Failure to do so will result in a civil penalty of up to £370;
- A Ratepayer must notify the relevant Council of a change in occupier of a property within 42 days. Failure to do so will also result in a civil penalty of up to £370 from 1 April 2021; and
- Councils will be able to initiate debt recovery as soon as payment of any instalment is missed.