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Transitional arrangements for rates increases

There is no need for a ratepayer to apply for the transitional arrangements as these are calculated automatically and any entitlement will be shown on the bill.

Following the introduction of business rates on 1 April 1990, many ratepayers faced large increases in the amount they would have to pay and others had considerably reduced bills.

To cushion the blow for businesses facing large increases, the government introduced legislation to limit the amount the business rate could go up. This is known as a transitional arrangement and also places a limit on the amount that rates can go down.

Historically property revaluations took place every 5 years (1990, 1995, 2000, 2005 and 2010). A further revaluation was due to take place in 2015 but for economic reasons the government decided to postpone this until 2017.  Most properties will therefore see either an increase or decrease in their Rateable Value (RV) with effect from 1 April 2017. Some properties will see no change in their RV from 1 April 2017.

For those that would otherwise see significant increases in their rates liability, the government has put in place a £3.6 billion transitional relief scheme to limit and phase in changes in rate bills as a result of the 2017 revaluation. To help pay for the limits on increases in bills, there also have to be limits on reductions in bills. Under the transitional scheme, limits continue to apply to yearly increases and decreases until the full amount is due (rateable value times the appropriate multiplier). The scheme applies only to the bill based on a property at the time of the revaluation. If there are any changes to the property after 1 April 2017, transitional arrangements will not normally apply to the part of a bill that relates to any increase in rateable value due to those changes. Changes to your bill as a result of other reasons (such as changes to the amount of small business rate relief) are not covered by the transitional arrangements.

The transitional arrangements are applied automatically and are shown on the front of your bill.

Further information about transitional arrangements and other reliefs may be obtained from the GOV.UK website.

More information on the 2017 revaluation can also be found on the GOV.UK website.

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