What Are Transitional Arrangements

Helping businesses adjust to changing business rates after a revaluation

All rateable values are reassessed at a general revaluation.

The 2017 revaluation takes effect from 1 April 2017.

For those ratepayers that would otherwise see significant increases in their rates liability, the Government has put in place a 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).

When will the Scheme apply? 

The scheme applies to 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.

Other changes not covered 

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.

 Transitional Arrangement (before inflation)

Upwards increase cap
Property size * 2017/18 2018/19 2019/20 2020/21 2021/22

 – Small property

– Medium property

– Large property

5.0%

 12.5%

42.0%

 

7.5%

17.5%

32.0%

 

10.0%

20.0%

49.0%

15.0%

25.0%

 16.0%

 

15.0%

25.0%

6.0%

 
Downwards decrease cap

Property size *

2017/18 2018/19 2019/20 2020/21 2021/22

 Small property

Medium property

 Large property

20.0%

10.0%

4.1%

 

30.0%

15.0%

4.6%

 

35.0%

20.0%

5.9%

 

55.0%

25.0%

5.8%

 

55.0%

25.0%

4.8%

 

The above percentages are also subject to an allowance for inflation which is 2% for 2017/18 and 3% for 2018/19. The inflation factor for the years after 2018/19 will be determined by the Government.

  •  A small property is one with a rateable value of less than or equal to £20,000.
  • A medium property is one with a rateable value of more than £20,000 and less or equal to £100,000.
  • A large property is one with a rateable value of more than £100,000.

For further information about transitional arrangements and other reliefs  

More information on the 2017 revaluation

Spring Statement 2018

1. At the Spring Statement on 13 March 2018, the Chancellor announced that the next business rates revaluation would be brought forward one year to 2021. Following the previous announcement on more frequent revaluations, this means that three-yearly revaluations will take effect in 2024. 

2. The Government has now also published a summary of responses to the discussion paper on more frequent revaluations, which can be found on the gov.uk website

3. To bring forward the next revaluation to 2021, the Government will shortly introduce secondary legislation to set the valuation date for the next revaluation at 1 April 2019. This will allow the VOA to start preparing for a 2021 revaluation. The Government intends to bring forward primary legislation to change the date of the next revaluation to 2021 in due course.