Transitional Relief

Transitional relief is a Government scheme which ensures that large increases or large decreases in rates bills which are due to the revaluation are phased in gradually over a number of years.

At each revaluation, a transitional scheme is introduced to protect the ratepayer from sharp increases in their rates bill. This is because property values, which affect the rental potential of the property and therefore the rateable value on which rate bills are calculated, change a good deal between each revaluation. Transitional relief is designed to ease the impact of revaluation, by phasing in the changes to the rates bill over a period of time. To help pay for the limits on increases in bills after a revaluation, there are also limits on reductions in bills.

Under the 2017 transitional relief scheme, limits will apply to yearly increases and decreases until 31 March 2022.

The transitional arrangements apply only to the bill based on your property at the time of the revaluation. If there are any changes to the rateable value of the property (eg because an extension has been added) after the revaluation date, transitional arrangements will not normally apply to the part of your bill that applies to any increase or decrease in rateable value due to those changes.

The table below shows the maximum increases and decreases Business Rates bills in transition will be subject to during the course of the current scheme.

  • Small property size is a 2017 rateable value of up to and including £20,000 outside London
  • Medium property size is a 2017 rateable value of £20,001 up to and including £100,000
  • Large property size is a 2017 rateable value over £100,000

Rate Increase Limits

Year

Small Property

Medium Property

Large Property

2017 to 2018

5%

12.50%

42%

2018 to 2019

7.50%

17.5%

32%

2019 to 2020

10%

20%

49%

2020 to 2021

15%

25%

16%

2021 to 2022

15%

25%

6%

Rate Decrease Limits

Year

Small Property

Medium Property

Large Property

2017 to 2018

20%

10%

4.10%

2018 to 2019

30%

15%

4.60%

2019 to 2020

35%

20%

5.90%

2020 to 2021

55%

25%

5.80%

2021 to 2022

55%

25%

4.80%

The inflationary increase for 2017/2018 is 2% inflation needs to be accounted for before transition is applied.

Last reviewed: 20 - 03 - 2017

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