A series of reforms to the business rates system took effect from 1 April 2026, following measures announced in the November 2025 Autumn Budget. These changes are intended to provide targeted support to businesses and modernise how rates are calculated.
The 2026 changes introduce a more tailored system, with:
- updated property valuations through revaluation
- a broader multiplier structure
- new and continued reliefs to manage increases
Overall, the reforms aim to balance support for smaller and high street businesses while increasing contributions from higher valued properties.
Revaluation
HMRC’s Valuation Office Agency (VOA) reassesses the rateable values of non domestic properties every three years. This process known as a revaluation, ensures that business rates better reflect current property market conditions.
As a result of the 2026 revaluation, businesses may see their rates bills increase, decrease, or remain unchanged, depending on how their property value has been updated.
Changes to Multipliers (Retail, Hospitality and Leisure)
Business rates liability is calculated using a property’s rateable value multiplied by a national multiplier. From April 2026, new legislation will introduce a revised structure for these multipliers.
Instead of the previous two-band system, there will now be five separate multipliers, based on:
- the rateable value (RV) of the property
- the type of use, particularly whether it falls within the Retail, Hospitality and Leisure (RHL) sector
This updated approach:
- replaces temporary relief schemes for RHL businesses with permanent reduced multipliers, and
- shifts a greater share of the overall burden towards higher value properties
Multipliers from April 2026
| Category | Rateable value (RV) | Multiplier (£) |
| Small Business RHL | Below £51,000 | 38.2p |
| Standard RHL | £51,000 – £499,999 | 43.0p |
| Large (all sectors) | £500,000 and above | 50.8p |
| Small Business (non RHL) | Below £51,000 | 43.2p |
| Standard (non RHL) | £51,000 – £499,999 | 48.0p |
Transitional Relief
Where rate bills rise following revaluation, a transitional relief scheme will automatically limit how much the bill can increase each year. The cap applied depends on the size of the property’s rateable value.
Maximum annual increases
| Property size | 2026/27 | 2027/28 | 2028/29 |
| Small (RV < £20,000) | 5% | 10% + inflation | 25% + inflation |
| Medium (£20,001–£100,000 RV) | 15% | 25% + inflation | 40% + inflation |
| Large (RV > £100,000) | 30% | 25% + inflation | 25% + inflation |
Transitional Relief Supplement
To help fund the transitional scheme, a temporary supplement of 1p is applied to some properties.
This applies where a ratepayer does not qualify for either:
- Transitional Relief, or
- Supporting Small Business Relief
The charge is calculated as:
Rateable Value: × £0.01
For example: £20,000 RV × 0.01 = £200
This supplement will apply for one year starting 1 April 2026.
Supporting Small Business Relief
From April 2026, a revised Supporting Small Business Relief (SSBR) scheme will be available where a property’s bill increases due to revaluation and the business has lost some or all of the following:
- Small Business Rate Relief
- Rural Rate Relief
- Retail, Hospitality and Leisure relief
- Previous (2023) Supporting Small Business Relief
Eligible ratepayers will see their bill increases limited to the greater of £800 or the relevant transitional cap.
Indicative caps (2026/27)
| Property size | Maximum increase |
| Small (< £20,000 RV) | 5% |
| Medium (£20,001–£100,000 RV) | 15% |
| Large (> £100,000 RV) | 30% |
Businesses already receiving support under the 2023 scheme will continue to benefit for a further 12 months.
Relief for Pubs and Live Music Venues
From April 2026, qualifying pubs and live music venues will receive a 15% reduction in business rates, in addition to other applicable reliefs.
Extension to Small Business Rate Relief (SBRR) Grace Period
Businesses that expand to occupy a second property will retain their existing Small Business Rate Relief on their main property for up to three years, an increase from the previous one-year period.
Electric Vehicle Charging Point Relief
Properties equipped with eligible electric vehicle charging infrastructure, including EV only forecourts, will qualify for 100% business rates relief for 10 years. Further details will be confirmed in upcoming regulations.