Last week saw Deputy First Minister John Swinney deliver the 2023-24 Scottish Budget, and as expected, there were several notable points made where business rates are concerned. As is always the case at budget time, there is the inevitable balancing act with winners and losers.
The Scottish Government have chosen to freeze the rate multiplier in Scotland, which is most welcome for ratepayers, particularly as liabilities would up have increased by over 10% in line with inflation otherwise.
- The Rates multiplier froze at 49.8p for properties with an assessment up to a Rateable Value of £51,000
- Intermediate and large property supplements are to apply at 1.3p for property assessment between £51,000 - £100,000 and 2.6p for those >£100,000. By comparison, England applies a single supplement of 1.3p for properties with an assessment >£51,000.
- Small business bonus scheme has been reformed and extended to remove circa 100,000 properties from the rate system.
- Fresh start relief threshold increased from £95,000 to £100,000
- A three-tier phased upwards transitional relief scheme was introduced to cap rate increases for those businesses most impacted.
- 100% relief for plant and machinery associated with renewable energy generation and storage.
Upwards Transitional Relief Scheme
2024 - 2025
2025 - 2026
Small (Up to £20,000)
Medium (£20,001 to £100,000)
Large (Over £100,000)
This new scheme will cap the increases in liabilities for the 2023 Revaluation in line with the table shown above.
The introduction of the upwards transitional relief scheme will be welcomed by most businesses, particularly those in the distribution and prime office sectors, as they will now be sheltered from a large proportion of the proposed liability increases.
Small Business Bonus Scheme
£12,000 to £15,000
100% to 25%
£15,000 to £20,000
25% to 0%
In line with previous budgets, the Scottish Government have always been supportive of small businesses. The reforming of the small business bonus scheme further supports this mantra by opening the scheme to a larger number of ratepayers. They have also committed to a transitional relief scheme for those who will lose the right to this relief, such as car parks, betting shops and advertising stations, which will be well received.
Overall, businesses and other ratepayers should be happy with today’s announcements: if anything, it gives some certainty and allows accurate budgets to be calculated for the year ahead.
THE TIME IS NOW
With a new two-stage appeal system being introduced in Scotland from 1st April 2023, ratepayers will have until the end of July to challenge their Rateable Value, so now is the time to put a plan in place.
Despite certainty being provided today, it must be said that with the new two-stage appeal system being introduced, it is now more critical than ever to have an expert advisor on your side. With the strict timescales for proposals being confirmed by today’s statement, time really is of the essence for Ratepayers to ensure their Rateable Values are accurate.