EXCLUSIVE: £17.5m up for grabs due to 'unacceptable' business rates over billing

Discretionary rates relief overbilling council errors 2017 business rates funding small businesses FSB
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Time is running out for retailers to secure a share of £17.5m in discretionary rates relief after councils failed to hand out the funds.

Small businesses across England were overbilled for last year’s business rates because councils failed to hand out £17.5m of the discretionary revaluation rates relief that was made available following the 2017 Spring Budget.

The funds were intended to help those with rates increases from April 2017.

A freedom of information campaign analysing relief spending at 220 councils by Retail Express found that more than two thirds had failed to distribute all the funds available. The average under spend at these councils was 20%.

An extension by the Ministry of Housing, Communities and Local Government (MHCLG) means there is still time for retailers to claim back their billed rates for 2017/2018, but only if councils “get their act together”.

Chartered surveyor and rates relief campaigner Ian Sloan contributed to the research. “It’s disappointing that even when they were warned, many councils and councillors still do not understand. Unless they get their act together this money will go to waste,” he warned.

Mike Cherry, chairman of the Federation of Small Businesses said the under spend was “completely unacceptable”. FSB research showed one in five small business owners considered selling or shutting because of rates hikes. 

Cherry added: “Many small businesses across England will have lost out causing untold pressure, leaving some in jeopardy.”

Find out if your local council has discretionary rates relief up for grabs

We've compiled more than 220 local authority discretionary rates relief spending figures so small businesses can find out whether they can receive a partial refund on their business rates for the 2017-2018 financial year.

Click here to download the full spreadsheet

The remaining funds should be available to any business with a rateable value below £200,000 that had a rates increase last year, even if they have already received small business rates relief or discretionary relief.

Ian Sloan advised retailers: “Write to your council and require a reason why you should not receive the relief.” A similar application for additional rates relief handled by Sloan and Retail Express saved Joe Williams from The Village Shop in Hook Norton, Oxfordshire, £9,000 in business rates.  

At the current average relief values there is enough left to give discounts to 14,536 English businesses.

While the average relief currently wasted by those councils with under spend is 20%, in some areas it is much higher. 

For example, Runnymede failed to hand out 71% of its funds and Fenland District Council withheld 87%. The Scilly Isles is yet to hand out a single penny of its small pot of discretionary relief.   

The findings follow a previous investigation by Retail Express in March that predicted massive under spending due to councils using a faulty formula to decide who received relief. 

The new research shows that though some local authorities have changed their formula after being shown Retail Express’s research, many more continue to deny there is a problem.

Do it: Read Retail Express' initial investigation revealing how councils failed to follow the Government's advice on discretionary rates relief

By Jack Courtez Avatar
By Jack Courtez 18 May, 2018


  • By rates_guru 18 May, 2018

    The issue of discretionary revaluation relief is just that "discretionary" and each Local Authority could set its own rules on how to award relief.
    The statement:
    "The remaining funds should be available to any business with a rateable value below £200,000 that had a rates increase last year, even if they have already received small business rates relief or discretionary relief."
    is therefore not factually correct. £200K was only a guideline used in the calculation of the sum made available to Councils by Central Government.
    Local Authorities would have had difficulty awarding the relief in some instances as they have to be satisfied EU State Aid does not apply.
    I feel it is a little harsh to single out the Isles of Scilly as they only had £15K to award for 2017/18 (and £7K for 2018/19). I cant imagine it being easy to work out how this could be awarded fairly without an overspend.

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