1. What Are Business Rates?
Business rates are a tax on most non-domestic properties in the UK, including shops, offices, warehouses, and commercial buildings. They’re based on the property’s rateable value, set by the Valuation Office Agency (VOA).
2. Can You Avoid Business Rates Legally?
Yes. While outright avoidance is rare, you can legally reduce or eliminate your business rates through reliefs, exemptions, and property decisions.
3. Small Business Rate Relief (SBRR)
If your property’s rateable value is under £15,000, you may qualify for:
- 100% relief if under £12,000
- Tapered relief between £12,001–£15,000
- Only one property (or additional ones under £2,900 RV each)
This is the most common way to avoid paying any rates.
4. Rural Rate Relief
If you run the only shop, pub, or post office in a rural area:
- You may get 100% rate relief
- Applies to properties under certain RV limits (e.g., £8,500 for shops)
Check with your local council.
5. Charitable Rate Relief
If your business is a registered charity or non-profit, you may get:
- 80% mandatory relief
- Up to 100% discretionary relief from the local council
This applies to charity shops and community organisations.
6. Empty Property Relief
If your property is empty, you may receive:
- 100% relief for 3 months (non-industrial)
- 6 months for industrial properties
After that, full rates apply unless further exemptions are met.
7. Using Shared or Flexible Workspaces
If you operate from:
- Serviced offices
- Shared co-working spaces
- Virtual offices
You may avoid direct liability for business rates since the provider usually pays.
8. Splitting Property into Smaller Units
Some businesses legally split larger properties into smaller, separately assessed units under £15,000 rateable value. This can:
- Qualify each for SBRR
- Reduce overall tax liability
Must be genuine business operations, not artificial avoidance.
9. Temporary Pop-Up Shops or Storage Use
If a property is reused temporarily between empty periods:
- It may restart the empty property relief period
- Must meet the minimum use period (often 6 weeks)
Used strategically by landlords and short-term tenants.
10. Appealing Your Rateable Value
If you believe your RV is too high, you can:
- Check your property on VOA
- Submit an appeal (Check, Challenge, Appeal process)
- If successful, this can lower your bill retroactively
11. Business Rates Holidays or Exemptions
Occasional government support includes:
- Retail, hospitality, and leisure relief (e.g., 50% off)
- COVID-19 support periods (past exemptions up to 100%)
- Monitor GOV.UK for current schemes
12. Avoiding Business Rates on Home-Based Businesses
If you:
- Work from home
- Don’t use a dedicated area solely for business
- Don’t have staff or customer visits
Then you may not be liable for business rates at all.
Frequently Asked Questions
Is it legal to avoid business rates?
Yes—using relief schemes, exemptions, and smart planning. Deliberate evasion is illegal.
Can landlords help reduce rates?
Yes, especially if you negotiate temporary leases, short-term lets, or use empty space.
Does subletting help avoid rates?
Possibly, if each unit gets its own RV and qualifies for relief.
Are start-ups exempt from business rates?
Not automatically, but many qualify for Small Business Rate Relief.
How do I apply for reliefs?
Through your local council—check their business rates section online.
Can I move to a cheaper property to reduce rates?
Yes. Choosing a property with a lower RV can save significantly.
Conclusion
Understanding how to avoid business rates legally in the UK gives you more control over your business expenses. Whether through reliefs, property decisions, or careful planning, you can reduce or eliminate this cost and reinvest those savings into your business. Check your eligibility and act now to optimise your rate position.