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Business Rates Relief for those in the Retail, Leisure and Hospitality sector and for nurseries

14 December 2020

From 1 April 2020 all retail, leisure and hospitality firms will be exempt from paying business rates for 12 months to help limit any further financial and economic damage that this pandemic is causing.

What is the relief?

The relief is a 100% business rates holiday for 12 months from 2020 to 2021.

It is an occupied relief for all ‘occupied’ premises.

Ratepayers with more than one property will be entitled to claim the relief for multiple properties, if each is eligible.

Who is eligible for the relief?

You will be eligible if:

  • your business is based in England; and
  • your business is in the retail, hospitality and/or leisure sector.

Generally, this will include occupied properties wholly or mainly being used:

  • as shops, restaurants, cafes, drinking establishments, cinemas and live music venues;
  • for assembly and leisure; and/or
  • as hotels, guest and boarding premises and self-catering accommodation.

The government has confirmed that where such properties are vacant due to Covid-19 and the restrictions on movement that have been imposed, they will still be classified as occupied for the purposes of this relief.

Applicability of the relief is, therefore, dependant on the use of the property, as opposed to its occupation.

The rateable value of the property is irrelevant for the purpose of this relief.

The relief has also been extended to children’s nurseries (see below).

Who will the relief not benefit?

Properties used to provide the following services to the public will not benefit from the relief:

  • Financial services
  • Medical services
  • Professional services
  • Post offices
  • Casinos and places of gambling
  • Other services including letting and estate agents and employment agencies

How to apply for the relief

There is no need to apply for the relief. The relief will be applied to rates bills sent out by Local Authorities in April 2020.

Local Authorities may have to reissue bills to exclude the business rate charge and will do this as soon as possible.

Children’s nurseries

Nurseries will also benefit from an 100% business rates holiday for 12 months from 2020 to 2021. 

The relief will apply to businesses based in England where the property is occupied by providers on Ofsted’s Early Years Register, or wholly or mainly used for the provision of the Early Years Foundation Stage.

No application is required to benefit from this relief.

Practicalities for those providing other services

This Government assistance fails to provide help for businesses in other sectors where business rates remain payable in full.

However, if, as a result of Covid-19, a property occupied by such businesses is left vacant, empty rates relief might, in theory apply, potentially giving three months’ relief, after which rates would become payable in full. This is likely to be very case specific. This relief applies to the property, rather than the person applying for it. So, changes in ownership during the three month grace period would not create a further three month exemption.

Tenants should check their lease, as most landlords include a provision that tenants must reimburse such reliefs to the landlord at the end of the term.

If you have any queries about business rates and possible reliefs your business might be entitled to please contact a member of the Real Estate team.

 

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