Small businesses operating from premises with a rateable value of less than £15,000 (or £21,500 in London) are generally entitled to business rate relief. This will reduce your business rate bill.

How is business rate relief calculated?

Small business rate relief is calculated by looking at the rateable value of a property. Normally, rateable values are multiplied by a figure set by the government. This multiplier is currently 48.5 for 2009-10.

If you qualify for small business rate relief you will use a different multiplier.

• If the rateable value of the property is less than £5,000, a multiplier of 48.1 is used. The resulting rate is then reduced by 50 per cent.
• If the rateable value of the property is between £5,000 and £9,999, a multiplier of 48.1 is again used, but the reduction decreases by 1 per cent for every £100 over £5,000.
• If the rateable value of the property is between £10,000 and £14,999 (or £21,499 in London), the multiplier of 48.1 is again used. There is no sliding reduction.

Bear in mind that these reliefs apply only in England and Scotland. The Welsh Assembly sets its own rates of relief, while Northern Ireland has a separate system offering relief only in exceptional circumstances.

Are there other business rate reliefs?

You may be able to claim other reliefs in the following circumstances:

• Charities and some community clubs can receive business rate relief up to 80 per cent.
• Some other non-profit organisations can receive relief up to 100 per cent, but this is discretionary.
• Some businesses in rural areas may be able to apply for further discretionary relief.

Much to the chagrin of business groups, business rate relief is not applied automatically. If you think you qualify for business rate relief you should contact your local council.