The 2026 business rates revaluation came into effect on 1 April 2026, and if your business occupies commercial premises in England or Wales, your rateable value may have changed. That means your annual rates bill could look different this year compared to last year, and in some cases the difference may be enough to affect your cash flow.
The Valuation Office Agency (VOA) has reassessed non-domestic properties using open market rental values as at 1 April 2024. Whether your bill goes up, down, or stays roughly the same depends on what happened to rental values for your type of property and location between the previous valuation date and the new one.
This guide explains what the revaluation means for your business, which reliefs and multipliers may apply in England, and what you should do if you think your new rateable value is wrong.
What Are Business Rates and How Are They Calculated?
Business rates are a property tax on non-domestic premises. They apply to many shops, offices, warehouses, factories, pubs, restaurants and other commercial properties. If your business occupies physical premises, business rates may be one of your regular fixed costs.
Your rates bill is calculated by multiplying your rateable value by the relevant business rates multiplier, then adjusting the figure for any reliefs, supplements or transitional arrangements that apply.
The rateable value is the VOA’s estimate of the open market annual rent your property could have achieved at a fixed valuation date. For the 2026 revaluation, that date was 1 April 2024.
For 2026/27 in England, the main non-domestic rating multipliers are:
| Property type | Rateable value | 2026/27 multiplier |
|---|---|---|
| Small business RHL property | Below £51,000 | 38.2p |
| Small business non-RHL property | Below £51,000 | 43.2p |
| Standard RHL property | £51,000 to £499,999 | 43.0p |
| Standard non-RHL property | £51,000 to £499,999 | 48.0p |
| High-value property | £500,000 and above | 50.8p |
RHL means retail, hospitality and leisure. The City of London can have different arrangements, and Wales has its own business rates system, so it is important to check the rules that apply to your property.
It is worth understanding the relationship between rates and your other business costs. If you use bookkeeping services that keep your overhead costs clearly tracked, you will be in a much stronger position to spot when one of these fixed costs changes and respond quickly.
What Happened on 1 April 2026?
The previous revaluation took effect on 1 April 2023 and was based on rental values as at 1 April 2021. The 2026 revaluation is the next in the cycle and reflects the government’s move towards more frequent revaluations, so rateable values stay closer to market conditions.
The table below summarises how the revaluation cycle has worked in recent years and what is expected going forward.
| Revaluation | Valuation Date | Effective Date |
|---|---|---|
| 2017 Revaluation | 1 April 2015 | 1 April 2017 |
| 2023 Revaluation | 1 April 2021 | 1 April 2023 |
| 2026 Revaluation | 1 April 2024 | 1 April 2026 |
| 2029 Revaluation | 1 April 2027, expected | 1 April 2029, expected |
The commercial property market changed significantly between 2021 and 2024. Logistics and warehouse space saw strong rental demand in many areas, while some retail and office markets experienced more varied movements. The impact of the 2026 revaluation will depend on what kind of property you occupy and where it is located.
Which Businesses Are Most Affected?
The revaluation does not affect all businesses equally. The sectors most likely to see meaningful changes to their rates bills include the following.
- Logistics and warehousing operators in areas where rental demand increased
- Retail businesses in high streets and town centres where rents have moved unevenly since the pandemic
- Hospitality businesses such as pubs, restaurants and hotels in areas where trading and rental conditions have changed
- Office occupiers in city centres where rental markets have either strengthened or softened depending on local demand
- Industrial businesses in areas that experienced above-average rental growth between 2021 and 2024
If you are already working with a corporation tax accountant to manage your overall tax liabilities, this is also the right time to factor any rates change into your annual cost forecasts and planning.
Transitional Relief: Smoothing Out Large Increases
Transitional relief is one of the key protections built into the revaluation system. It limits how sharply your rates bill can increase in a single year as a result of revaluation.
For the 2026 revaluation in England, transitional relief applies where your bill is increasing by more than the permitted cap. Your local council should apply it automatically if you are eligible.
The caps for increases from 1 April 2026 to 31 March 2029 are based on your rateable value. For 2026/27, the annual increase is capped at:
| Rateable value | 2026/27 cap |
|---|---|
| Up to £20,000, or £28,000 in London | 5% |
| £20,001 to £100,000, or £28,001 to £100,000 in London | 15% |
| Over £100,000 | 30% |
For later years in the transitional period, different caps apply. Your actual bill may also be affected by other reliefs, supplements and local adjustments.
Understanding transitional relief matters when you are thinking about your broader cost base. If you are calculating your corporation tax position each year, knowing what your rates bill will be in the current and following year helps you plan more accurately. Business rates are generally a deductible business expense, so they can affect your taxable profit.
To get a clearer picture of your corporation tax position, you can use our Corporation Tax Calculator as a starting point.
Small Business Rates Relief: Do You Still Qualify?
Small Business Rates Relief (SBRR) is one of the most valuable reliefs available for smaller businesses with commercial premises. Under the current rules in England:
- Properties with a rateable value of £12,000 or less can receive 100% relief if the property is the only one your business uses
- Properties with a rateable value between £12,001 and £15,000 receive tapered relief on a sliding scale
- If you use more than one property, you may still qualify in limited circumstances, depending on the rateable values of the other properties and your total rateable value
From 27 November 2025, the government extended the grace period for some businesses expanding into a second property from 1 year to 3 years. This means some businesses can continue to receive SBRR on their original property for longer after taking on an additional premises, subject to the rules.
Because the 2026 revaluation has changed rateable values across the board, some businesses may lose relief they previously relied on, while others may qualify for the first time. It is worth checking your updated rateable value and your council bill as soon as possible to confirm your position.
If you are uncertain how any change affects your overall tax picture, speaking to a personal tax accountant or your regular accountant is a sensible step.
Retail, Hospitality and Leisure Multipliers
Retail, Hospitality and Leisure (RHL) relief gave eligible properties a 40% discount on business rates bills for 2025/26, subject to a cash cap of £110,000 per business.
From April 2026 in England, that relief has been replaced by lower RHL multipliers for qualifying retail, hospitality and leisure properties with rateable values below £500,000. These lower multipliers are intended to give eligible high street and hospitality businesses a lower business rates charge than comparable non-RHL properties.
For 2026/27, the RHL multipliers are:
| RHL property type | Rateable value | 2026/27 multiplier |
|---|---|---|
| Small business RHL property | Below £51,000 | 38.2p |
| Standard RHL property | £51,000 to £499,999 | 43.0p |
Properties with a rateable value of £500,000 or more fall into the high-value multiplier category, even if they are in the retail, hospitality or leisure sector.
Pubs and live music venues may also receive additional support in 2026/27, including a 15% relief on top of the RHL multipliers where they meet the relevant conditions.
These kinds of cost changes belong in your regular management accounts service so that you can see their effect on margins and plan around them, rather than finding out at year-end that your costs were higher than expected.
What If You Think Your Rateable Value Is Wrong?
If you believe the VOA has assessed your property’s rateable value too highly, you have the right to challenge it. The process in England is called Check, Challenge, Appeal (CCA) and it works in three stages.
First, you check the factual details the VOA holds about your property, including its size, use and any special features. Errors at this stage can sometimes be corrected straightforwardly.
If the facts are correct but you still disagree with the valuation, you move to the challenge stage, where you present your own evidence, such as comparable rental values. If the challenge does not result in a change you accept, you can escalate to the appeal stage at the Valuation Tribunal.
One important point is that you must continue paying your rates bill while a challenge is being processed. This makes keeping accurate small business bookkeeping records particularly important, so you have a clear record of payments made and can claim any refund efficiently if your challenge succeeds.
How the Revaluation Interacts With Your Financial Planning
Business rates can be a significant overhead for businesses with physical premises, sometimes running to thousands or tens of thousands of pounds per year. A change following the 2026 revaluation is a useful prompt to review your entire cost structure.
Understanding whether you are on a cash vs accrual accounting basis matters here, because the timing of how you account for rates payments can affect your year-end position. It is also worth reviewing the 3 accounting reports every limited company owner should review regularly to make sure your rates costs are being tracked clearly alongside other fixed overheads.
If your business also employs staff, there are other cost changes to watch. Employer National Insurance increased in April 2025, with the main rate rising to 15% and the secondary threshold reducing. If you are not yet working with payroll accountants Stockport businesses rely on for accuracy, it is worth considering whether your payroll processes are as efficient as they could be. There are 5 payroll problems small employers can avoid that regularly cause cash flow issues, and being aware of them matters more when other costs are also rising.
The VAT Question
Business rates do not count towards your VAT registration threshold because they are a cost, not taxable turnover. However, a higher rates bill can put extra pressure on cash flow, especially if your turnover is already close to the VAT registration threshold or you are considering voluntary VAT registration.
If your turnover is approaching the VAT threshold, it is worth understanding the hidden cost of the VAT threshold and reviewing whether voluntary registration might suit your business. You can use our VAT Calculator to model the impact, and it is worth reading up on understanding VAT registration if this is a decision you have been deferring.
Our UK VAT rates guide gives a clear overview of the current rates and how they apply to different types of supply, which is useful context when you are modelling your costs.
You can also check signs your business needs to register for VAT early for a fuller picture of when early registration makes commercial sense.
Cloud Accounting Makes Cost Tracking Far Easier
One of the practical advantages of working with a Xero accountant is that you can track exactly how your overheads are moving in real time rather than finding out after the fact. If your rates bill increases from April 2026, you want to see that immediately in your reports, not several months later when you are reviewing a spreadsheet.
How Xero can make it easier to stay on top of cash flow is a question many businesses ask after switching from manual records, and the answer almost always comes back to visibility of fixed costs. If you have been managing your finances through spreadsheets, it is worth reading about when you should move from spreadsheets to Xero and what the transition actually involves.
Messy records make cost planning much harder. If you recognise the risks described in why messy bookkeeping creates problems at year-end, getting your records in better shape now will help you manage the impact of any rates change much more confidently.
The Personal Tax Angle
If you are a sole trader or an individual landlord paying business rates on commercial property, there is also a personal tax dimension to consider. Rates paid on premises used wholly or mainly for business purposes are generally a deductible expense, which reduces the income on which you pay UK income tax.
A higher rates bill means a larger business expense, which may reduce your taxable profit. A lower bill has the opposite effect. Neither change should be viewed in isolation, but it feeds into the overall picture when you are completing your self-assessment return. If you have not yet worked with a personal tax accountant to review your position, this is a reasonable prompt to do so.
You can use our Self-Employed Tax Calculator to model how changes to your deductible costs affect your overall tax liability.
Could Relocating Change Your Cost Picture?
For some businesses, a significant increase in rateable value following the 2026 revaluation prompts a wider question about premises. Whether the space you currently occupy still represents good value, whether a different location might offer lower costs, or whether your whole operating model should be reviewed are all legitimate questions to raise at this point.
Some businesses are also taking this opportunity to think more fundamentally about where they base their operations. If the combined effect of rising rates, employment costs and other overheads is making your current setup less viable, a relocation service dubai uk businesses are increasingly using can open up a very different cost and tax environment worth exploring.If your business is structured as a limited company, changes to your premises costs also interact with your directors loan accounts position and any property held within the company. These nuances are worth discussing with your accountant before making any significant decisions.
How a Good Accountant Can Help
Working with stockport accountancy services you trust means having someone who can put the 2026 revaluation in the context of your overall financial position. A good accountant will help you do all of the following.
- Check your new rateable value and compare it to your previous figure to understand the full financial impact
- Review your eligibility for SBRR, RHL multipliers, pub or live music venue support, or any other applicable relief
- Factor the change into your forecasts and make sure it is reflected accurately in your management accounts
- Understand the effect on your corporation tax deadlines in the UK and payment planning
- Assess whether there are opportunities to reduce corporation tax through other means to offset any increase in your rates cost
If you are in the early stages of your business, our guide on how to register as self-employed and the sole trader advantages versus limited company comparison may also be relevant context as you decide how to structure your business going forward.
Our tax tables for 2025/26 are also a useful reference for understanding all the key thresholds and rates in one place.
You can also review our bookkeeping checklists for UK small businesses to make sure your records are in good shape and that how often you update your bookkeeping matches the complexity of your business.
FAQs: Business Rates Revaluation 2026
What is the 2026 business rates revaluation?
It is the process by which the Valuation Office Agency reassessed the rateable values of non-domestic properties in England and Wales using rental values from 1 April 2024. The new values took effect on 1 April 2026.
Will my business rates go up after the revaluation?
Not necessarily. The outcome depends on how rents for your type of property in your location changed between the previous valuation date and 1 April 2024. Some businesses will pay more, others less, and some will see little change. Your final bill also depends on the relevant multiplier, reliefs and transitional arrangements.
How do I find out my new rateable value?
You can search for your property using the VOA’s online business rates valuation service on GOV.UK. Your local council should also issue your business rates bill using the updated figures.
What is transitional relief?
Transitional relief limits how much your rates bill can increase in a single year as a result of revaluation. If your bill has risen sharply because of the 2026 revaluation, the increase may be phased in rather than applied in full immediately.
Can I appeal if I think my rateable value is wrong?
Yes. In England, you can use the Check, Challenge, Appeal process. You start by checking the factual details the VOA holds about your property, then challenge the valuation if you believe it is too high, and appeal to the Valuation Tribunal if the challenge is unsuccessful.
Does the revaluation affect Small Business Rates Relief eligibility?
Yes. Your eligibility for SBRR is based on your updated rateable value and your property circumstances. If your value has changed, it is worth checking whether you now qualify for relief you did not previously receive, or whether you have moved outside the qualifying threshold.
Are business rates tax deductible?
Yes, business rates paid on premises used wholly or mainly for business purposes are generally an allowable business expense. This applies whether you trade as a sole trader, partnership or limited company, provided the cost relates to the business.
Ready to Get Your Finances in Order?
The 2026 business rates revaluation is one of several significant cost changes for UK businesses this year. At U&W Chartered Accountants, we help businesses across Stockport and understand their full financial position and plan ahead for changes like these.
Whether you need support with day-to-day accounts, help understanding your rates position, or a broader review of your business finances, our team is here. Find out more about us or get in touch via our contact page.
Ready to get started? Request a quote for your limited company today and see how straightforward working with a dedicated accountant can be.
