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Small businesses looking to expand premises could soon find it easier following new government commitments to make business rates fairer. An interim report from the Treasury says that the Chancellor will examine ways to tackle “cliff edges” in the system - sudden jumps in rates that can discourage investment.
Currently, if a small business opens a second property, it immediately loses all entitlement to Small Business Rates Relief (SBRR). The government now says it will review how SBRR can support business growth.
The report also confirms that from April 2026, permanently lower tax rates will be introduced for shops, pubs, restaurants, and other retail, hospitality, and leisure businesses with a rateable value below £500,000.
Changes to how business rates are calculated are also under review
Business groups have been advocating for changes in the way business rates are calculated. They welcomed the report’s confirmation that the government will also consider moving from the current “slab” model (where the whole property is taxed at the highest rate) to a “slice” model (where tax gradually increases with value).
What happens next
This is an interim report. An update will be provided at the Autumn Budget on 26 November 2025.
If you are looking to expand your business into new premises, business rates are not the only factor to consider. If you would like help formulating or assessing plans for business expansion, why not contact us? We would be happy to help you!
Some self-employed taxpayers who filed their 2024/25 self-assessment tax return may have been incorrectly asked to pay class 2 national insurance contributions (NIC) on their SA302 tax calculation. HM Revenue & Customs (HMRC) has now confirmed that this issue has been fixed.
For many sole traders and small business owners, reviewing their accounting system only happens when something forces the issue. For instance, many sole traders are currently looking at whether their accounting system meets the requirements for Making Tax Digital for Income Tax.
