Business rates are payable by businesses that use non-domestic properties. They can be thought of as the business equivalent of council tax.

Will I have to pay?

If you use either all or part of a building for business purposes, you will probably have to pay business rates. There are a very few exceptions to this, including farm buildings and farm land; places of public worship; and moveable moorings.

Bear in mind that if you work from home you may also have to pay business rates on the part of the building used for business. There is no set rule for determining whether or not business rates will be charged in these cases; it is up to the discretion of each council. In general, though, you are more likely to have to pay if a portion of your house is used solely and exclusively for business purposes.

How much are business rates?

Business rates vary from property to property, and are based on the estimated amount that the premises would fetch if they were put up for rent on the open market. The Valuation Office Agency (VOA) then uses this figure, along with factors like how the property is likely to be used, to work out a rateable value. Properties are revalued every five years.

The rateable value is then multipled by a government-set figure to determine the applicable business rates. The standard multiplier for premises in England for 2009-10 is 48.5. So a property with a rateable value of £100,000 would attract a business rate charge of £48,500.

You can find the rateable value of your premises through the VOA website by clicking here.

How do I pay business rates?

If you are liable for business rates you will receive a bill from the council each year. This normally happens in March or April. You will generally be asked to make 10 monthly payments.

It is generally the owner or leaseholder that is liable for business rates. If you are renting business premises from a third party, rates are probably included in the amount you pay your landlord.

Business rates relief

Many small businesses are entitled to business rates relief that can reduce your business rates bill. Click here for more information on business rates relief.