Local government finance circular 4/2025: non-domestic rates relief guidance
General information relating to current arrangements for non-domestic rates reliefs in 2025 to 2026.
Annex D - Small business bonus scheme worked examples
Note: These worked examples do not include interactions with transitional relief schemes which are covered in the Transitional Relief Worked Examples.
Example 1
Ratepayer is liable for rates on one property.
RV in 2025-26 is £10,000.
Gross liability = 10,000 x 0.498 = £4,980.
As the rateable value is less than £12,000, then 100% relief is awarded.
Bill in 2025-26 = £0
Example 2
Ratepayer is liable for rates on one property.
RV in 2025-26 is £14,000.
Gross liability = £14,000 x 0.498 = £6,972
As the rateable value is between £12,001 and £15,000, then relief percentage is calculated according to the following formula: 100 – (75 x (1 - (15000 - RV)3000)
Relief percentage = 100 – (75 x (1 - (15000 - 14000)3000))
Relief percentage = 100 – (75 x (1 – 0.33333…))
Relief percentage = 100 – 50
Relief percentage = 50
£6,972 x 50% = £3,486
Bill in 2025-26 = £6,972 - £3,486 = £3,486
Example 3
Ratepayer is liable for rates on one property.
RV in 2025-26 is £16,000.
Gross liability = £16,000 x 0.498 = £7,968
As the rateable value is greater than £15,000, then the relief percentage is calculated according to the following formula: 25 x ((20000 - RV)5000)
Relief percentage = 25 x ((20000 - 16000)5000))
Relief percentage = 25 x 0.8
Relief percentage = 20%
£7,968 x 20% = £1,593.60
Bill in 2025-26 = £7,968 – £1,593.60 = £6,374.40
Example 4
Ratepayer is liable for rates on one property.
RV in 2025-26 is £25,000.
Gross liability = 25,000 x 0.498 = £12,450.
As the rateable value is greater than £20,000, no relief is awarded.
Bill in 2025-26 = £12,450.
Example 5
Ratepayer is liable for rates on more than one property, but the cumulative rateable value does not exceed £12,000.
RV for the individual property in 2025-26 is £10,000.
Gross liability = 10,000 x 0.498 = £4,980.
As the cumulative rateable value is less than £12,000, then 100% relief is awarded.
Bill in 2025-26 = £0.
Example 6
Ratepayer is liable for rates on more than one property, and the cumulative rateable value exceeds £12,000, but does not exceed £35,000.
RV for the individual property in 2025-26 is £14,000.
Gross liability = £14,000 x 0.498 = £6,972
As the cumulative rateable value is between £12,001 and £35,000 and the individual rateable value does not exceed £15,000, 25% relief is awarded.
£6,972 x 25% = £1,743
Bill in 2025-26 = £6,972 - £1,743 = £5,229
Example 7
Ratepayer is liable for rates on more than one property, and the cumulative rateable value exceeds £12,000, but does not exceed £35,000.
RV in 2025-26 is £16,000.
Gross liability = £16,000 x 0.498 = £7,968
As the rateable value is between £15,001 and £20,000, then the relief percentage is calculated according to the following formula: 25 x ((20000 - RV)5000))
Relief percentage = 25 x ((20000 - 16000)5000))
Relief percentage = 25 x 0.8
Relief percentage = 20%
£7,968 x 20% = £1,593.60
Bill in 2025-26 = £7,968 – £1,593.60 = £6,374.40
Example 8
Ratepayer is liable for rates on more than one property, and the cumulative rateable value is greater than £35,000.
RV in 2025-26 is £10,000.
Gross liability = 10,000 x 0.498 = £4,980.
As the cumulative rateable value is greater than £35,000, then no relief is awarded.
Bill in 2025-26 = £4,980.
Example 9
Ratepayer is liable for rates on one property, which is also eligible for the 40% hospitality relief.
RV in 2025-26 is £15,000.
Gross liability = £15,000 x 0.498 = £7,470
As the rateable value is between £12,001 and £15,000, the relief percentage is calculated according to the following formula: 100 – (75 x (1 - (15000 - RV)3000))
Relief percentage = 100 – (75 x (1 - (15000 - 15000)3000))
Relief percentage = 100 – (75 x (1 – 0))
Relief percentage = 100 – 75
Relief percentage = 25
£7,470 x 25% = £1,867.50
The hospitality relief is also calculated on the gross bill.
£7,470 x 40% = £2,988
Bill in 2025-26 = £7,470 - £1,867.50 - £2,988 = £2,614.50