Business rate reductions
Unoccupied property rating
In general, there will be no business rates to pay in the first three months that a property is empty. This is extended to six months in the case of certain industrial properties. After that, rates are payable in full unless the property is exempt from the unoccupied rates.
Exemptions include listed buildings, and small properties with rateable values below a certain threshold. These thresholds are:
Rateable Value Thresholds
|2011/12 (to 2015)
Are there any exemptions to this charge?
After the initial three or six month free period expires, the empty property will be liable for 100% of the basic occupied business rate unless:-
- It is held by a charity and appears likely to be next used for charitable purposes.
- It is held by a community amateur sports club and appears to be next used for the purpose of the club.
- The rateable value of the property is less than £2,600 (with effect from 1st April 2011)
- The owner is prohibited by law from occupying the property.
- The owner is prohibited by action taken by the crown, or any other local or public authority from occupying the premises.
- The property is included in the schedule of monuments compiled under s.1 to the ancient monuments and archaeological areas act 1979.
- The owner is entitled to possession only in his capacity as the personal representative of a deceased person.
If the following insolvency or debt administration situation exists:
- A bankruptcy order within parts 8 to 11 of the insolvency act 1986.
- The owner is a trustee under a deed of arrangement to which the deeds of arrangement act 1914 applies.
- The owner is a company subject to a winding up order made under the insolvency act 1986.
- The owner is entitled to possession of the property in his capacity as liquidator or administrator under s112 or s145 of the insolvency act 1986.
Partly occupied property relief
A ratepayer is liable for the full non-domestic rate whether a property is wholly occupied or only partly occupied. Where a property is partly occupied for a short time; e.g. where a company phases its removal from one property to another; Lancaster City Council has the discretion to award relief in respect of any unoccupied part subject to state aid limits. For further guidance on state aid please visit https://www.gov.uk/state-aid.
To apply for this relief you must contact the Business Rate Section as soon as partial occupancy begins. An inspection of the premises will be arranged to confirm the partial occupancy. You may also be required to provide a plan of the premises so that the Valuation Office Agency can accurately apportion the rateable value between the occupied and unoccupied areas.
Charitable and discretionary relief
Charities are entitled to relief from rates on any non-domestic property that is wholly or mainly used for charitable purposes. Relief is given at 80% of the bill. Local councils have discretion to give further relief on the remaining bill subject to state aid limits.
Authorities also have discretion to give relief on all or part of any rate bill for property occupied by certain non-profit making bodies subject to state aid limits.
From 1st April 2012 the council may also grant up to 100% relief to any ratepayer subject to state aid limits.
They can also consider giving rate relief in cases of hardship or where part of a property is beyond use for a certain period subject to state aid limits.
For further guidance on state aid please visit https://www.gov.uk/state-aid.
Rate relief for community amateur sports clubs
There are provisions allowing for 80% mandatory rate relief to be granted to sports clubs that have registered with the Inland Revenue as community amateur sports clubs (CASC). In addition CASCs benefit from a range of tax reliefs through HM Revenue and Customs.
You are likely to to be successful in applying for registration if you can answer "yes" to all of the following questions:
- is membership of the club open to the whole community?
- are all club facilities available to all members without discrimination?
- does the club's constitution prevent club profits being distributed amongst its members?
- does the club provide facilities for, and to encourage, participation in an eligible sport?
- does the club's constitution provide that on dissolution of the club, any net assets are to be applied for approved sporting or charitable purposes?
Further information on CASC registration and the relevant application forms can be viewed and downloaded at
or call the HM Revenue and Customs Sports Clubs Unit on 0845 3020203
Rate relief for businesses in rural areas
The scheme provides for rate relief for those businesses in small settlements in rural areas with a population below 3000, and consists of two elements:
50% Mandatory relief is applicable to:
- The sole general store, a food store and the sole post office in a qualifying settlement, whose rateable value is less than £8,500
- The sole public house and the sole petrol filling station in a qualifying settlement, whose rateable value is less than £12,500
Discretionary relief may be granted to any business in the settlement, whose rateable value is less than £16,500, which the authority believes is of benefit to the local community. However in exercising this discretion the council must have regard to the interests of its council tax payers as a whole.
What are rural areas and qualifying settlements?
Rural areas are defined by legislation and for this council include all parishes with the exception of Bolton le Sands, Carnforth and Slyne with Hest.
Qualifying settlements must be within a designated rural area and have a population of no more than 3,000 on the prior 31st December. These are reviewed where necessary.
For the purposes of this relief, as all the rural parishes have a population of no more than 3,000, it is proposed that they all be treated as rural settlements with the exception of the following:
Caton with Littledale be split between Caton and Brookhouse (including Littledale).
Ellel be split between Dolphinholme, Galgate (to the West of the railway line and North of Salford Road) and the remainder.
What are the qualifying criteria?
A general store must be a business consisting wholly or mainly of the retail sale of both food for human consumption (excluding confectionery) and general household goods, and no other such business is carried on in the settlement. Confectionery does not count as food for the purpose of deciding whether a shop is general store.
When deciding whether a business is a general store, food and general household goods are considered as a single unit and together they must form the majority of the goods on sale.
A food store must be a business consisting wholly or mainly of the sale by retail of food for human consumption (excluding confectionery and excluding the supply of food in the course of catering).
The supply of food in the course of catering includes any supply of food for consumption on the premises on which it is supplied; and any supply of hot food for consumption off those premises.
A post office must be used for the purposes within the meaning of the Post Office Act 1953, and no other property in the settlement is used as such.
A public house means premises for which a justices’ on-licence, within the meaning of the Licensing Act 1964 (other than under Part IV of that Act) is in force.
Petrol filling station means premises where petrol or other automotive fuels are sold retail to the general public for fuelling motor vehicles intended or adapted for use on roads.
What if there are two such premises in the settlement?
With the exception of food stores, unfortunately neither can qualify for mandatory relief on that basis, although if either functions as a post office then relief may be claimed on that ground.
If I get 50% mandatory relief, can I also claim discretionary relief?
Yes, additional discretionary relief can be claimed, to take the total relief up to the actual rate charge subject to state aid limits.
Can other businesses apply for discretionary relief?
Yes, discretionary relief can be claimed up to the amount of the actual rate charge subject to state aid limits.
The council has a limited budget from which awards of discretionary rate relief can be made and whilst willing to accept any application for discretionary rate relief under this scheme, it will particularly welcome applications which meet the following criteria.
- The business is a small business
- Accounts for the accounting year ending in the preceding business rate year (preferably certified) show that the ‘value added per full-time equivalent employee’ is less than £6,660 per annum
- The business had employed the full-time equivalent of five or less persons in the accounting year ending in the preceding business rate year and had not reduced its employment levels in the six months following the end of that financial year.
Search rural areas and business premises
View an interactive map of rural areas and qualifying premises
• On the map you can search for a specific address, or drag, scroll and zoom to an area.
• Tick the relevant boxes on the right hand side to view food shops, petrol stations and pubs.
• Click on points on the map to bring up further information.
The council at its discretion, can award up to 100% relief from business rates to ratepayers who are experiencing hardship subject to state aid limits. However, as the council funds a significant part of the relief itself, cases will only be considered if they are in the interest of the community. Each case will be considered on its own merits but any reduction is the exception rather than the rule. The test of 'hardship' is not confined strictly to financial hardship - all relevant factors affecting a ratepayer's ability to meet its liability are taken into account.
Also, the council must bear in mind the fact that the government has modernised empty property relief because it is committed to promoting the efficient use of land and property and provide a positive incentive to bring vacant shops, offices, workshops and warehouses back into use. These reforms are intended to encourage owners to re-let, re-develop or sell unused property, thus, improving access to premises and reducing rents for businesses, as well as reducing the need for development on greenfield land.
Small Business Rate Relief
See: Small Business Rate Relief
Discretionary Rate Relief Policy
The Council has discretion to grant relief of up to 100% of the rates on properties occupied by certain non-profit making bodies, or in the case of registered charities that are entitled to 80% mandatory relief, to top the relief up to 100%. From 1st April 2012 the Council may also grant up to 100% relief to any ratepayer subject to state aid limits.
In deciding whether to grant discretionary relief, the Council will look at the contribution that the organisation makes to the area. Consideration will also be given to whether services provided replace, enhance or supplement current Council facilities and priority will be given to those organisations that benefit the local community specifically. The Council must also have regard to the interests of its Council Tax payers when making their decision.
The broad framework to be used in decision making is provided in the table below:
|Scouts, Guides etc.
||Usually qualify for 80% Mandatory Relief. In such circumstances 20% top-up relief will be awarded.
|Village Halls, Community Centres, Youth Clubs and Playgroups.
||20% top-up will be considered, in addition to 80% Mandatory relief.
Alternatively, up to 100% Discretionary relief will be considered for such organisations.
||20% top-up will be considered, in addition to 80% Mandatory relief, where the organisation wholly or mainly benefits local residents.
Alternatively, up to 100% Discretionary relief will be considered for such organisations specifically benefiting local residents.
||20% top-up will be considered only in cases where the charity wholly or mainly benefits local residents.
|Sports and Recreational Organisations
||No application will be considered without evidence of an application for Community Amateur Sports Club status. An exemption to this rule will be applied for small organisations where the need to draft a Constitution would not prove cost effective. eg. Village bowling club.
Discretionary relief will be considered for organisations that do not qualify for Community Amateur Sports Club status on the individual merits of each case, providing the main aims are sporting rather than social.
Sporting and recreational clubs operating with a bar, included in the rating assessment, will not normally be awarded discretionary rate relief. However, if the main purpose of the club is to provide sporting and social activities, and the bar is ancillary to this, relief may still be awarded where the finances of the organisation warrant additional help, but at a % below the maximum level.
|Organisations in rural areas
||50% top-up relief will be considered on the individual merits of each case, for those businesses located in a rural settlement that qualify for Mandatory Relief, where the business is classed as a Post Office, general store or food shop.
Pure Discretionary relief for other businesses in a rural settlement will be considered on the individual merits of each case, where there is a proven need for additional financial assistance.
In such cases the organisation must benefit the local community, taking into account the financial impact upon Council Tax payers.
||Relief will be considered on the individual merits of each case.
Consideration will also be given to non-profit making bodies which form part of the City’s history or heritage, or otherwise make a significant contribution to the City’s status, through tourism or other factors.
From 1st April 2012 relief can be granted to any other ratepayer, giving due consideration to the interests of council tax payers.
|Organisations in financial difficulties.
|Hardship relief will be considered on the individual merits of each case, when evidenced that it is in the interests of the community to do so.
Other criteria taken into account:
Access and provision of facilities:
- Is membership open to all sectors of the community
- Excessive membership fees set at a level to exclude the general community will be seen as restrictive
- 75% of members should be City Council residents
- The level of effort made by the organisation to encourage membership from particular groups in the community. eg. young people, women, older age groups, disabled persons, ethnic minorities etc.
- Are facilities made available to people other than members. eg. Schools, casual public sessions
- Does the organisation provide facilities which indirectly relieve the authority of the need to do so, or enhance and supplement those which it does provide, particularly if the need is considered a priority by the Council
In general, the club or organisation must show that the criteria by which it considers applications for membership are consistent with the principles of open access.
Extent to which activity is based around a Bar and use of Profits from it:
Relief will not be given to those organisations where a bar is the main activity and relief will not be awarded. It would be expected that any bar profits would be put back to offset club expenses, negating the reliance upon public funds.
Rural Rate Relief:
Discretionary relief is not restricted to any particular type of business.
In making a judgement, officers will balance the interests of the individual ratepayer or small community against that of Council Tax payers in general. If granting relief has a very small, but negative impact on tax payers it may still be reasonable to grant relief.
General Applications for Relief:
From April 2012, the Council can award discretionary rate relief to any ratepayer subject to state aid limits.
In making a judgement, officers will balance the interests of the individual ratepayer or small community against that of Council Tax payers in general, taking into consideration local factors, and whether the council’s financial position allows for a reduction to be made.
Examples of these factors would be:
- the impact on local employment of the potential decline / loss of existing business
- opportunities for local development and regeneration
- increased employment by encouraging businesses into the area
Consideration will be given on a one off basis to businesses suffering severe financial hardship, where it is evident that it is in the interests of the local community that the ratepayer remains in business because either:
- He/she provides a unique, regularly required amenity, eg. a village general store, or
- The loss of employment provided by the ratepayer would be severely damaging to the local community.
Under the Local Government Finance Act 1988, there is no right of appeal against the Council’s use of discretionary powers. However, the Council will accept a customer’s request for a re-determination of its decision, to be presented to the Executive Member for Resources for further consideration.
- Applications for relief will be considered on their individual merits in relation to the Council’s overall financial position.
- Applications for relief can only be backdated to the beginning of the financial year in which the application was made, subject to exceptional circumstances.
- Annual reviews will be carried out of those organisations in receipt of relief.
- Where relief is granted to organisations funded by the Council, the cost of the relief may be met by adjusting grant levels to ensure that there is no adverse effect on Council Tax payers.
How do I apply?
Contact the Business Rates team at the address below.
Alternatively, download an application form from Download a Business Rate Document.
Cancellation of backdated rates liabilities
The Government has put in place regulations to allow for the cancellation of certain backdated business rates liabilities. The relevant regulations, the Non-Domestic Rating (Cancellation of Backdated Liabilities) Regulations 2012 (SI 2012/537), can be found on the www.legislation.gov.uk website.
New Build Empty Property Relief
The government have introduced as a temporary measure the power for Local Authorities to grant an exemption to unoccupied non domestic hereditaments that are wholly or mainly comprised of new structures that are completed after the 1st October 2013 and before the 30th September 2016 subject to state aid limits.
For guidance on state aid please follow this link:- https://www.gov.uk/state-aid
For further information on this exemption and to obtain details on how to apply please contact our section on the contact details provided below.