Supporting small businesses (SSB)
The Chancellor announced in the Spring Budget held on the 8 March 2017 that a relief scheme would be made available to those ratepayers facing large bill increases as a result of the loss of small business or rural rate relief effective of 1 April 2017.
The supporting small businesses relief will assist those ratepayers who as a result of the change in their rateable value at the revaluation are losing some or all of their small business or rural rate relief and, as a result, are facing large increases in their bills. To support these ratepayers, the supporting small businesses relief will ensure that the increase per year in the bills of these ratepayers is limited to the greater of:
- a cash value of £600 per year (£50 per month). This cash increase ensures that those ratepayers currently paying nothing or very small amounts are brought into paying something, or
- the matching cap on increases for small properties in the transitional relief scheme.
In the first year of the scheme, all rate payers losing some of their small business rate relief or rural rate relief will see the first increase in their bill capped at £600. Their bill will increase by £600 per year thereafter.
Those on the Supporting Small Businesses relief scheme whose 2017 rateable values are £51,000 or more will not be liable to pay the supplement (1.3p) to fund small business rate relief while they are eligible for the Supporting Small Businesses relief scheme.
Should there be a change of circumstances such as a rateable value adjustment, the amount of relief awarded under the Supporting Small Businesses relief scheme will be recalculated
It is necessary for the Council to establish that the awarding of aid will not result in the ratepayer having received more than 200,000 Euros of de minimis aid and therefore applicants will be required to make a declaration in relation to State Aid in their application for relief. More information can be found on the State Aid website.
A change of ratepayers will not affect eligibility for the Supporting Small Business relief scheme but eligibility will be lost if the property becomes vacant or a charity or community amateur club take over.
The Council has awarded eligible accounts with the Supporting Small Business relief and any adjusted bills have been issued.
Local Discretionary Business Rate Relief
In the Spring Budget 2017, the government announced a local discretionary fund of £300 million, to be distributed under ‘locally designed criteria’. This fund allocates decreasing amounts to councils over four years.
Croydon Council’s share of this pot for 2017/18 was £1.791m. This reduced to £0.870m for 2018/19 and will decrease to £0.358m and £0.051m in the following two years.
Within the annual funding allocation, Local discretionary business rate relief (LDBRR) is calculated after any or all of the following have been applied:
- Exemptions and other reliefs
- Transitional reliefs or premiums
And before the application of the Business Rates Supplement (BRS). LDBRR does not apply to the BRS supplement.
In accordance with the terms of the government grant for LDBRR, all ratepayers will be subject to CPI inflationary increase on their bill in 2018/19, to which the relief will not apply.
Relief will be awarded upon the following basis:
|Type of Business||Relief Percentage|
|Small Businesses (rateable value up to £28,000)||4.54%|
|Medium Businesses (rateable value between £28,001 and £100,000)||0%|
|Large Businesses (rateable value over £100,000)||0%|
As there is fixed funding and pre-determined criteria, ratepayers will not be invited to apply. Instead the Council has informed ratepayers in writing of the amount of relief awarded, via an annual rates bill in March 2018.
It was announced in the Autumn Budget 2018 that the Government would provide funding for occupied retail properties with a rateable value of less than £51,000 in each of the years 2019/20 and 2020/21. The value of discount will be one third of the bill, and must be applied after mandatory reliefs and other discretionary reliefs funded by section 31 grants.
To qualify for the relief, the retail property needs to be wholly or mainly being used as shops, restaurants, cafes and drinking establishments.
We consider shops, restaurants, cafes and drinking establishments to mean:
i. Hereditaments that are being used for the sale of goods to visiting members of the public:
− Shops (such as: florists, bakers, butchers, grocers, greengrocers, jewellers, stationers, off licences, chemists, newsagents, hardware stores, supermarkets, etc)
− Charity shops
− Post offices
− Furnishing shops/ display rooms (such as: carpet shops, double glazing, garage doors)
− Car/ caravan show rooms
− Second hand car lots
− Petrol stations
− Garden centres
− Art galleries (where art is for sale/hire)
ii. Hereditaments that are being used for the provision of the following services to visiting members of the public:
− Hair and beauty services (such as: hair dressers, nail bars, beauty salons, tanning shops, etc)
− Shoe repairs/ key cutting
− Travel agents
− Ticket offices e.g. for theatre
− Dry cleaners
− PC/ TV/ domestic appliance repair
− Funeral directors
− Photo processing
− Tool hire
− Car hire
iii. Hereditaments that are being used for the sale of food and/ or drink to visiting members of the public:
− Sandwich shops
− Coffee shops
The list below sets out the types of uses that the Government does not consider to be retail use for the purpose of this relief.
i. Hereditaments that are being used for the provision of the following services to visiting members of the public:
− Financial services (e.g. banks, building societies, cash points, bureaux de change, payday lenders, betting shops, pawn brokers)
− Other services (e.g. estate agents, letting agents, employment agencies)
− Medical services (e.g. vets, dentists, doctors, osteopaths, chiropractors
− Professional services (e.g. solicitors, accountants, insurance agents/ financial advisers, tutors)
− Post office sorting offices
ii. Hereditaments that are not reasonably accessible to visiting members of the public
The Council will automatically award retail relief to those businesses who are eligible to qualify, and amended business rates bills will be issued to those businesses.