Small Business Rates Relief Rises to £18,000 for Shops, Pubs and Cafés in England from April 2027
From 1 April 2027, retail, hospitality and leisure properties in England with a rateable value up to £18,000 will pay no business rates, up from £12,000, and the government says around 70,000 more businesses will leave business rates.
By Entrepreneur Group · Published
Retail, hospitality and leisure properties in England with a rateable value of up to £18,000 will pay no business rates from 1 April 2027, up from £12,000 now. The change was announced in the Autumn Budget on 28 October 2026, and the government says around 70,000 more businesses will leave business rates as a result.
The higher threshold covers qualifying shops, pubs, cafés, restaurants and leisure venues. Commentary on the Budget documents says offices, workshops and other premises outside these sectors keep the existing thresholds.
What changes for small premises
Small Business Rates Relief (SBRR) currently gives 100% relief to properties with a rateable value up to £12,000, tapering to nothing at £15,000. According to analysis by Vail Williams, from 1 April 2027 qualifying retail, hospitality and leisure properties get:
- 100% relief up to a rateable value of £18,000;
- tapered relief between £18,000 and £21,000;
- a higher limit, £29,999, on the combined rateable value of additional properties that can be ignored when deciding eligibility, until 31 March 2029.
The Treasury says half of all retail, hospitality and leisure properties will pay no business rates, and all of them will have bills frozen in real terms, reduced or cut to zero over the next two years. Vail Williams says increases for eligible properties are capped at CPI inflation in 2027/28 and 2028/29.
Pubs and live music venues
Pubs, social clubs and most live music venues already had a 20% business rates cut confirmed from April 2027. The Budget adds a further 20 percentage points of relief in 2027/28 and 2028/29, taking it to 35%. Live music venues with a rateable value of £1 million or more stay at 15%.
The Morning Advertiser reports Treasury figures showing that an additional 3,500 pubs, roughly one in 10 in England, will pay no business rates from April 2027 because of the higher SBRR threshold. It says the Treasury estimates average savings of more than £3,000 per pub for those still paying.
Who misses out
Vape shops lose access to SBRR and the lower retail, hospitality and leisure multipliers from April 2027. Adult gaming centres lose those multipliers but can still claim SBRR at the existing £12,000 and £15,000 thresholds. The government says the package is paid for by tackling non-compliance on online marketplaces, raising gambling tax on higher-risk machine games and extending a 1p supplement on rates bills.
Business rates are devolved. Scotland, Wales and Northern Ireland receive extra funding under the Barnett formula and decide whether to offer similar support.
What this means for founders
This section is editorial guidance, not tax advice.
- Check your rateable value. You can find it on the Valuation Office Agency's online service. If it is £21,000 or less and you trade in retail, hospitality or leisure, you may pay less or nothing from April 2027.
- Confirm your use class. The relief depends on how the property is used. If you run a mixed business, such as a café inside a studio, ask your council how it will be treated.
- Claim the relief. SBRR is applied by your local council. Contact it if your 2027/28 bill does not reflect the new thresholds.
- Do not assume office space is covered. The higher thresholds apply only to qualifying retail, hospitality and leisure properties.
Frequently asked questions
What is the new Small Business Rates Relief threshold?
From 1 April 2027, qualifying retail, hospitality and leisure properties in England with a rateable value up to £18,000 get 100% relief, tapering to nothing at £21,000. The previous thresholds were £12,000 and £15,000.
Does the £18,000 threshold apply to offices?
No. Analysis of the Budget documents says the higher thresholds apply only to qualifying retail, hospitality and leisure properties, and other premises keep the existing thresholds.
How much business rates relief do pubs get from April 2027?
Qualifying pubs, social clubs and most live music venues in England get 35% relief in 2027/28 and 2028/29, and around 3,500 more pubs will pay nothing because of the higher threshold.
Sources
- HM Treasury: Budget 2026: Breathing space for today, hope for the future (28 October 2026) (reviewed 29 October 2026)
- Vail Williams: Autumn Budget 2026: Business rates relief welcome, but fundamental reform overdue (28 October 2026) (reviewed 29 October 2026)
- Morning Advertiser: Around one in 10 pubs to become exempt from business rates (28 October 2026) (reviewed 29 October 2026)