What is Business Rates? UK Definition 2026/27
Quick Answer
A tax on non-domestic properties based on their rateable value.
Definition of Business Rates
Business rates are a property tax charged on most non-domestic premises including shops, offices, pubs, warehouses, and factories. The amount is based on the property's rateable value set by the Valuation Office Agency, multiplied by the business rates multiplier set by the government.
Business Rates — Key Facts for 2026/27
| Small business multiplier | 49.9p (2026/27) |
| Standard multiplier | 54.6p (2026/27) |
| Small Business Relief | 100% up to £12,000 RV |
| Revaluation | Every 3 years |
How Business Rates Works — Example
- 1Rateable value: £25,000
- 2Standard multiplier: 54.6p
- 3Annual rates: £25,000 × 0.546 = £13,650
- 4Monthly payment: £1,137.50
How Business Rates Affects Your Tax
Business rates are a significant cost for commercial premises. Small Business Rate Relief can reduce or eliminate rates for qualifying properties. The rateable value also determines eligibility for other reliefs.
Official HMRC Guidance on Business Rates
For official guidance, refer to HMRC's documentation. Tax rules can change, so always verify current rates and thresholds on gov.uk.
GOV.UK: Business rates guideFrequently Asked Questions about Business Rates
Accuracy Note
This information is for guidance only and is based on 2026/27 tax year rates. Tax rules are complex and your circumstances may differ. For personal advice, consult a qualified accountant or tax adviser.