Small Business Rate Relief applications to be streamlined in 2007/08

The Government has, at last, reacted to the chaos of the Small Business Rate Relief (SBRR) scheme and announced a 'streamlining' of the process of applying for SBRR. But the streamlining won't be implemented until the 2007/08 financial year, so all small business wanting to claim their business rates relief will have to apply every year, for another two years!

We first highlighted the problems with the SBRR scheme back in June. At the time, fewer than half of the small businesses that were eligible for the reduction in their rates had applied for their discount. This meant that some 400,000 small businesses were missing out on a rate reduction of up to £2,500.

If you haven't already made your claim, the September 30 deadline is looming so read the original article to find out about it and how to claim your small business rate relief.

Under the Government's initial plans for the SBRR, every small business had to make a new application to claim the rate relief every year. Now, with some 850,000 small businesses being eligible for SBRR, it doesn't take a rocket scientist to work out that the SBRR scheme would instantly create a mountain of extra paperwork for small businesses and local councils. And, that this burden would arise every year.

But last week, after 'consultation' Phil Woolas the Local Government minister claimed to be riding to the rescue of small businesses and announced,

"In an Order laid before Parliament, businesses whose circumstances do not change will only need to apply once, for a period of up to five years, for small business rate relief. Previously, small businesses were required to apply every year. The Order we have laid in parliament will allow small business, whose circumstances have not changed, to apply only once for small business rate relief for a period of up to five years."

On the surface, that seems to be great news, no more unnecessary form-filling for 5 years. But oh no! As with so many of the Government trumpettings, the details of the announcement reveal the truth behind the headlines.

The reality is that, "Under the revised scheme, ratepayers eligible for the relief will be required to apply for small business rate relief for the financial year 2007/08 and will not be required to apply again until the next revaluation (financial year 2010/11) provided their circumstances have not changed in that period."

So, to get the reduction in business rates, small businesses will have to apply for this financial year (2005/06) and for the following two years, before the 'streamlining' relieves them of the burden for the three years after that.

I make that, 3 applications in 6 years, not the 1 application in 5 years the Local Government minister claims the streamlining will bring!

Is it any wonder only half of eligible small businesses have so far bothered to claim the small business rate relief?