Small businesses are to receive help with their business rates with the introduction of a new government scheme.
From 1 April 2005, businesses with property valued at less than £5,000 will be eligible for small business rates relief, which could reduce their bill by 50 per cent.
The tax break will also extend to small businesses with additional properties, where individual values do not exceed £2,200 and their combined rateable value is below £15,000.
The measure will come as some relief to employers, especially those situated in London, with many challenging the Valuation Office Agency, which gives the rates, on the basis that increased congestion charging should reflect in their calculations.
The relief will decrease on a sliding scale of 1 per cent for every £100 of value over £5,000, with a maximum cap of £9,999.
Chas Roy-Chowdhury, head of taxation at ACCA, said: "The rates relief scheme will lessen the impact of the recent rates revaluation, which has increased the rateable values of most business properties.
"April will also see the Uniform Business Rate (UBR) - the multiplier used to calculate the rates bill - reduced for small businesses, from 45.6p in the pound to 41.5p. Both these changes should mean only minimal rates bill increases for small firms, as opposed to them being subject to full newly revalued rates bills."
