Delay to business rates discount

03-Feb-2020 - Last updated on 03-Feb-2020 at 16:58 GMT

Rates relief: the Government announced the business rates discount for eligible pubs last month (January)

The business rate relief for thousands of pubs that was announced by the Government last month (January) will be delayed for some councils due to ‘software changes’.

The Government announced that pubs with a rateable value of below £100,000 will have their business rates bill reduced by £1,000 from this April.

Chancellor of the Exchequer Sajid Javid announced the shift last month (Saturday 25 January) and it was predicted as many as 18,000 pubs are expected to benefit from the discount.

The relief is on top of an extended retail discount, which smaller pubs are also eligible for, and those qualifying for both will get up to £13,500 off their annual bills.

Annual billing

Pubs with a rateable value of below £51,000 already get a third off their rates bill through the retail discount and the new £1,000 discount is in addition, and will apply after the retail reduction.

According to real estate advisor Altus Group, councils that use Civica software have been told the firm is currently unable to bring in the changes in time for annual billing.

More than 75 councils use Civica’s OpenRevenues system to streamline administration of non-domestic rates.

Repeat incident

This means when licensees receive their rates bill this April, it may be more than anticipated as it won’t show the discounted amount, which will then mean councils will have to refund operators at a later date.

This isn’t the first time something like this has happened as in 2017, four in 10 councils hadn’t started distributing the relief six months after it was announced, with many blaming software problems then.

While exact length of time for how long operators may have to wait to see the relief this time isn’t clear, in 2017, it took up to seven months.

Altus Group head of UK business rates Robert Hayton said history seemed to be repeating itself, referring to similar delays in 2017, implementing £300m of discretionary reliefs.

He added: “Tax demands can be manually adjusted by councils so it is ridiculous small firms in England will have to wait to receive the help they have been promised.

“Assurances must be given that enforcement for non-payment will not take place until the reliefs have finally been put in place.”