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Business Rates: Understanding Your Financial Obligations

At Calculated Accountants we know that setting up a new business is no easy task. There are a lot of issues to deal with and a lot of financial matters to take into consideration including commercial property taxes.

If your business has commercial premises then you will need to ensure that you are aware of the property taxes that you will be expected to pay. As a business owner it is your legal obligation to keep on top of the payments that are expected of you, none more so than business rates.  

What are Business Rates?

Business rates otherwise known as non domestic rates is the tax charged on commercial properties.

How are Business Rates Calculated?

Business rates are calculated by taking the rateable value of your premises plus the business rate multiplier (set by the government). Many businesses will often appeal the charges they face with the belief that the rateable value of their premises has been incorrectly calculated.

What Kind of Property are Business Rates applied to?

Business rates are applied to the majority of properties that are used for commercial purposes. This may include factories, shops, offices and even homes.

 Who Pays the Business Rates?

If you own a property than you liable however you may also be liable if you are leasing or renting premises so ensure that you discuss the issue with your landlord.

What are Business Rates For?

Your business rates payments are used to pay for local services including car parking, police services and the fire brigade.

My Business is only Small, Am I Still Expected to Pay Business Rates?

Small business can qualify for business rate relief on the condition that the rateable value of the property is less then £15,000. If your rateable value is however between £5,000-£10,000 then the percentage of relief you are entitled to will continue to decrease. An application for relief can be made via the local council.

How Often Am I Expected to Pay Business Rates?

Your business rate is an annual payment that can be made over a number of months. Repayments can be discussed with your local council.

Business rates can often be one of the biggest charges imposed, therefore whether you are a small business or start up business owner; ensure you remain aware of the obligations you will face and speak to your accountant to ensure you never miss a payment. 

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