Non-Domestic Rates Relief Statistics 2021

Background notes

Context

Non-Domestic Rates, often referred to as business rates, are levied on non-domestic properties, subject to statutory exemptions and reliefs. The valuation of non-domestic properties is undertaken independently by the Scottish Assessors, subject to statutory appeal processes, with all valuations freely accessible on the Scottish Assessors' website (https://www.saa.gov.uk/). Scottish Ministers annually set a national poundage (tax rate), which is applied to a property's rateable value. Rating, including billing, collection, enforcement and determination of rates relief, is undertaken by local authorities. A ratepayer may appeal to the local authority on the grounds that they are being improperly charged.

A number of reliefs are available for certain types of property nationally under Scottish law. These are subject to the domestic subsidy control regime, which is governed by the UK's international commitments on subsidy control arising from, amongst others, the EU-UK Trade and Cooperation Agreement (TCA), World Trade Organisation Membership and commitments arising from international treaties and agreements to which the UK is a party.^[8] Some reliefs are mandatory (i.e. must be applied) and some are discretionary (i.e. local authorities have discretion as to their application).

Under Part 11 of the Community Empowerment (Scotland) Act 2015, local authorities may also reduce or remit Non-Domestic Rates. In doing so, they must have regard to the authority's expenditure and income and the interests of persons liable to pay council tax set by the authority. The revenue impact of local reliefs must be borne by the local authority.

Further information on Non-Domestic Rates and reliefs can be found at https://www.mygov.scot/browse/business/non-domestic-rates, and in the detailed guidance for local authorities, which is available on the Scottish Government's website.^[9]

Data

In this publication, "relief" may mean either a relief or an exemption. The term "properties" is used for lands and heritages listed as separate entries on the Valuation Roll – most of which are buildings, though a small number may be land, for example shooting rights, car parks etc.

The information in this publication is derived from the annual local authority Billing System Snapshot,^[10] which is a list of each individual relief in place at the snapshot date, along with associated property reference numbers. These reference numbers are used to match each relief to the property details on the Valuation Roll, which is obtained from the Scottish Assessors Association's website, via its Government Users Portal. The continued co-operation of Local Authorities in providing the Billing System Snapshot is gratefully acknowledged.

The Billing System Snapshot in 2020 did not include properties which were only in receipt of the 1.6% universal relief. As this relief was awarded to all properties in Scotland, those on the Valuation Roll as at 1 July 2020, but not reported in the snapshot returns, were assumed to be in receipt of this relief.

Some properties receive more than one type of relief, so the total number of reliefs awarded is greater than the total number of properties receiving relief.

Zero-rated properties have been excluded from all tables in the publication. For more information on zero-rated properties in receipt of relief, please see Table 11.

Some tables in this document omit previous years to ease readability. In these cases, equivalent information for 2018, 2019, and 2020 can be found in the publication tables workbook.

Relief values

The numbers and values of reliefs awarded that are presented in this publication include both mandatory and discretionary reliefs.

Some reliefs are fully mandatory (e.g. SBBS relief) or fully discretionary, while some reliefs have a mandatory and a discretionary component (e.g. charity or sports relief for registered charities or Community Amateur Sports Clubs).

Mandatory reliefs (or mandatory components of relief) are fully funded by the Scottish Government, whereas discretionary reliefs (or discretionary components of reliefs) are generally 25% funded by councils with the Scottish Government providing 75% (though this can vary, e.g. discretionary sports relief can in certain cases be 100% funded by the Scottish Government).

The value of reliefs presented here include the full values of the discretionary reliefs, and not just the part that is funded by the Scottish Government. Other sources of NDRI data present only the Scottish Government's contribution to the value of reliefs. For instance, Scottish Local Government Finance Statistics (SLGFS)^[11] show final, audited, relief values, which are the actual values of the reliefs for the entire year, and, unlike the relief values in this publication, include only the Scottish Government's contribution to the value of discretionary reliefs. Figures for 2021-22 are expected to be published in early 2023.

The relief values in this publication are the value of awards as at the snapshot date, and do not necessarily reflect the cost of a given award over the full year – for example, some reliefs will be awarded later in the year and will be backdated, while some may have been cancelled before the snapshot date – therefore the relief values as at the snapshot are likely to be an underestimate of total annual relief values. Rateable values may also change during the course of the year, which would affect final annual relief values.

Snapshot date

The Billing System Snapshot is usually taken two to three months following annual billing, to allow time for councils to process relief (re)applications from ratepayers following receipt of their bills, and so to give as full a picture as possible of current relief entitlement.

The snapshot date in 2021 was 1 June, which is a return to the usual timing (the snapshot date was 1 June in 2018, and 31 May in 2019 due to 1 June being a Saturday).

In 2020, the snapshot date was 1 July, a month later than usual, as most local authorities had delayed their annual billing due to the COVID-19 pandemic.

Previous publications (pre-2019) of SBBS relief statistics were based on summary returns (SBBS totals) from local authorities. For this reason, headline figures in previous (pre-2019) SBBS publications are not comparable with the headline SBBS figures presented in this publication.

Definitions

Non-Domestic Rates are a property tax. They are based on the rateable value of a non-domestic property, multiplied by a poundage set nationally by Scottish Ministers. In 2021-22, the poundage rates are:

• a basic poundage of 49p for properties with a rateable value not greater than £51,000;
• the Intermediate Property Rate of 50.3p (1.3p supplement on the basic poundage) for properties with a rateable value between £51,001 and up to £95,000; and
• the Higher Property Rate of 51.6p (2.6p supplement on the basic poundage) for properties with a rateable value greater than £95,000.

For example, a property with a rateable value of £20,000 will have a gross bill of £20,000 × 0.49 = £9,800.

A property with a rateable value of £100,000 would have a gross bill of
£100,000 × (0.49 + 0.026) = £51,600.

A number of reliefs are available for certain types of property, some of which are mandatory (i.e. they must be applied) and some are discretionary (i.e. local authorities have discretion as to their application). Most reliefs are application-based, and the ratepayer must submit an application to the local authority (except in the case of Religious exemptions and Lighthouse relief – which are automatically granted at 100%). Local authorities may not necessarily require recurrent annual applications, but in some cases they may review certain reliefs by requiring all recipients to re-apply.

Reliefs are awarded as a percentage of the gross bill, and in some cases, notably SBBS relief, are based on the rateable value of the property.

More detail about eligibility for the SBBS relief is set out Table 12 below. Detailed guidance for the application on all reliefs is available in the Local Government Finance Circular 6/2021, https://www.gov.scot/publications/local-government-finance-circular-6-2021-non-domestic-rates-relief-for-2021to-2022/.

Eligibility for SBBS relief

SBBS relief offers up to 100% relief on Non-Domestic Rates bills for eligible properties in Scotland. Eligibility for SBBS relief and the level of relief awarded will depend upon the individual rateable value of each property occupied by the ratepayer, and the cumulative rateable value of all the properties in Scotland of which a person is in rateable occupation (or if vacant, which the ratepayer is entitled to occupy).

If the total rateable value of the ratepayer's properties is above £35,000, none of the properties will be eligible for SBBS relief, even if some or all of the ratepayer's properties have rateable values below the individual property SBBS relief thresholds. This ensures that relief is targeted at the smallest businesses.

Table 12: SBBS relief criteria 2008-09 to 2021-22

Year		Rateable Value (RV) Band			Relief for higher value business chains
		Lower	Middle	Upper
2008-09	Cumulative RV threshold*	up to £8,000	£8,001 to £10,000	£10,001 to £15,000	greater than £15,000
	Relief	80%	40%	20%	0%
2009-10	Cumulative RV threshold*	up to £8,000	£8,001 to £10,000	£10,001 to £15,000	greater than £15,000
	Relief	100%	50%	25%	0%
2010-11 to 2013-14	Cumulative RV threshold*	up to £10,000	£10,001 to £12,000	£12,001 to £18,000	£18,000 to £25,000
	Relief	100%	50%	25%	25% on each individual property with an RV not exceeding £18,000
2014-15 to 2015-16	Cumulative RV threshold*	up to £10,000	£10,001 to £12,000	£12,001 to £18,000	£18,000 to £35,000
	Relief	100%	50%	25%	25% on each individual property with an RV not exceeding £18,000
2017-18 onwards	Cumulative RV threshold*	up to £15,000	N/A	£15,001 to £18,000	Over £18,000 and up to £35,000
	Relief	100%	N/A	25%	25% on each individual property with an RV not exceeding £18,000

* Lower, Middle and Upper RV bands also apply to businesses with a single property

Eligibility for RHLA relief

RHLA relief was awarded automatically in 2020-21 to eligible properties, and reduced the rates payable for those properties to nil. In 2021-22 it was made application-based.

RHLA relief was available in both 2020-21 and 2021-22 to properties listed and the use of which is defined in Schedule 1 of the Non-Domestic Rates (Coronavirus Reliefs) (Scotland) Regulations 2021^[12] – namely those used as bed and breakfast accommodation; camping sites; caravans; caravan sites; chalets, holiday huts and bothies; guest houses, hotels and hostels; public houses; restaurants; self-catering accommodation; timeshare accommodation; markets; retail shops; leisure; service providers (hair and beauty services, shoe repairs, key cutting, photo processing, laundry services, car or tool hire, car washing or repair of domestic electronic/electrical goods); letting agencies and funeral parlours; travel agencies; newspaper publishing.

Schedule 2 of the same regulations also grants 100% relief to the following airports: Aberdeen International, Barra, Benbecula, Campbeltown, Cumbernauld, Dundee, Edinburgh, Glasgow, Glasgow Prestwick, Inverness, Islay, Kirkwall, Oban, Stornoway, Sumburgh, Tiree, and Wick John O'Groats. Relief is also granted to other properties situated at these airports and used to provide handling services for scheduled passenger flights (e.g. re-fuelling or baggage handling), as well as all properties occupied by Loganair, which operates flights in the Highlands and Islands.

Reporting conventions

In this publication, figures showing numbers of properties or ratepayers have been rounded to the nearest ten, with values greater than zero but less than five shown as 0, and those greater than five but lower than ten rounded up to ten. All actual zero values (both counts and values) are shown as a dash (-).

Designated utilities

Specific local authorities have responsibility for utilities valued under the designated Assessors' regime:

• Electricity – South Lanarkshire Council
• Water – Fife Council
• Gas – West Dunbartonshire Council
• Docks and harbours – Falkirk Council
• Railways – Highland Council
• Canals – Highland Council
• Fixed-line communications – Renfrewshire Council

Further information

More information on Non-Domestic Rates, including appeals procedures and reliefs, is available on https://www.mygov.scot/browse/business/non-domestic-rates.

Further Local Government Finance statistics can be found at https://www.gov.scot/collections/local-government-finance-statistics/. This includes a section on Non-Domestic Rates statistics, including revaluation appeals, reliefs, income, and COVID-19 business support grants.