Retail rate relief
At the Budget on 27th October 2021, the Chancellor announced the introduction of a new business rates relief scheme for Retail, Hospitality and Leisure properties.
The 2022/2023 Retail, Hospitality and Leisure Business Rates Relief scheme will provide eligible, occupied, retail, hospitality, and leisure properties with a 50% relief, up to a cash cap limit of £110,000 per business. The property must be occupied (i.e. open/trading), and allow reasonable access to visiting members of the public.
To qualify for the relief the business property should be wholly or mainly used for retail purposes.
Please note that the following businesses will no longer qualify for relief from 1 April 2022:
- Employment agencies
- Estate and letting agents
- Betting shops
Businesses may choose to opt out of support by providing billing authorities with notification of their request to refuse support, per eligible hereditament.
Eligibility for Retail, Hospitality and Leisure Relief Scheme
1. Hereditaments that meet the eligibility for expanded retail rate relief will be occupied hereditaments which meet all of the following conditions for the chargeable day:
a. they are wholly or mainly being used:
i. as shops, restaurants, cafes, drinking establishments, cinemas and live music venues,
ii. for assembly and leisure; or
iii. as hotels, guest & boarding premises and self-catering accommodation,
2. Government considers shops, restaurants, cafes, drinking establishments, cinemas and live music venues 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: hairdressers, 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
iv. Hereditaments which are being used as cinemas
v. Hereditaments that are being used as live music venues:
- Live music venues are hereditaments wholly or mainly used for the performance of live music for the purpose of entertaining an audience. Hereditaments cannot be considered a live music venue for the purpose of business rates relief where a venue is wholly or mainly used as a nightclub or a theatre, for the purposes of the Town and Country Planning (Use Classes) Order 1987 (as amended).
- Hereditaments can be a live music venue even if used for other activities, but only if those other activities (i) are merely ancillary or incidental to the performance of live music (e.g. the sale/supply of alcohol to audience members) or (ii) do not affect the fact that the primary activity for the premises is the performance of live music (e.g. because those other activities are insufficiently regular or frequent, such as a polling station or a fortnightly community event).
- There may be circumstances in which it is difficult to tell whether an activity is a performance of live music or, instead, the playing of recorded music. Although we would expect this would be clear in most circumstances, guidance on this may be found in Chapter 16 of the statutory guidance issued in April 2018 under section 182 of the Licensing Act 2003.
3. Government considers assembly and leisure to mean:
i. Hereditaments that are being used for the provision of sport, leisure and facilities to visiting members of the public (including for the viewing of such activities).
- Sports grounds and clubs
- Museums and art galleries
- Sport and leisure facilities
- Stately homes and historic houses
- Tourist attractions
- Wellness centres, spas, massage parlours
- Casinos, gambling clubs and bingo halls
ii. Hereditaments that are being used for the assembly of visiting members of the public.
- Public halls
- Clubhouses, clubs and institutions
4. Government considers hotels, guest & boarding premises and self-catering accommodation to mean:
i. Hereditaments where the non-domestic part is being used for the provision of living accommodation as a business:
- Hotels, Guest and Boarding Houses
- Holiday homes
- Caravan parks and sites
To qualify the hereditament should be wholly or mainly used as shown above, this is a test on use rather than occupation. Therefore, hereditaments which are occupied but not wholly or mainly used for a qualifying purpose will not qualify for the relief.
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.
- Financial services (e.g. banks, building societies, cash points, bureaux de change, short-term loan providers)
- Medical services (e.g. vets, dentists, doctors, osteopaths, chiropractors)
- Professional services (e.g. solicitors, accountants, insurance agents/ financial advisers)
- Post office sorting offices
ii. Hereditaments that are not reasonably accessible to visiting member of the public.
You can have this relief on more than one property.