Official Statistics

National non-domestic rates collected by councils in England: forecast for 2022 to 2023

Updated 15 March 2023

Applies to England

This release provides data on the forecast of non-domestic rating income due to local authorities in 2022-23, including data relating to the amount of business rates reliefs forecast to be given to businesses. The data are based on returns received from all 309 billing authorities in England. This release does not directly compare figures to the previous year’s data as it would be inappropriate due to the exceptional business rates reliefs announced in response to the COVID-19 pandemic which were in place during 2020-21 and 2021-22. This data has been updated on 16 March 2022 with revisions from 4 authorities.

1. In this release

• Local authorities estimate the non-domestic rating income for 2022-23 will be £22.5 billion. This is what authorities estimate they will collect after all reliefs, accounting adjustments and sums retained outside the rates retention scheme are taken into consideration.
• Local authorities estimate that they will grant a total of £7.6 billion of relief from business rates in 2022-23. Of this £1.5 billion is the net cost of small business rate relief, £3.2 billion is the cost of other mandatory relief and £2.8 billion is the cost of discretionary relief. Of the discretionary relief, £2.7 billion is the cost of the retail, hospitality and leisure relief.
• The £1.5 billion small business rate relief cost is a net figure. Authorities estimate they will grant £2.2 billion relief under the Small Business Rate relief scheme, but this is offset by other businesses contributing £629 million in the form of a supplement to cover some of the cost of this relief.
• Total relief provided to charitable occupations (that is both mandatory and discretionary relief) is expected to amount to £2.1 billion in respect of 2022-23.

Release date: 16 February 2022 (updated 16 March 2022)
Date of next release: February 2023
Contact: 0303 444 8433 / nndr.statistics@levellingup.gov.uk (Responsible Statistician: Jo Coleman)
Media enquiries: 0303 444 1209 / NewsDesk@levellingup.gov.uk

2. Introduction

This release has been compiled by the Department for Levelling Up, Housing and Communities (DLUHC) and it provides information on national non-domestic rates and associated information for the financial year 2022-23. This information is derived from the national non-domestic rates (NNDR1) returns submitted by the 309 billing authorities in England that will be in existence from 1 April 2022. The data are based on returns received from all 309 billing authorities in England.

The data in this release are not directly compared to 2021-22 or 2020-21 because of the exceptional business rates reliefs introduced in those years in response to the COVID-19 pandemic. These reliefs provided a 100% business rates discount to businesses in the retail, hospitality and leisure sector and to eligible nurseries in 2020-21 and the first 3 months of 2021-22, and then 66% relief for the remaining 9 months. This means that the income is significantly lower and reliefs are higher for 2020-21 outturn and 2021-22 forecast than normal, and so not comparable to previous or subsequent years. These reliefs are included in the figures for 2020-21 and 2021-22 in tables 1 and 2.

Non-domestic rates, or business rates, are collected by billing authorities and are the way in which those that occupy a non-domestic property (or hereditament) contribute towards local services. Since 2013-14 local authorities are allowed to retain a proportion of the revenue that is generated in their area. The NNDR1 form collects data that estimates what authorities will collect and the outturn data (collected on the NNDR3) is what was collected.

Apart from properties that are exempt from business rates, such as agricultural land, parks and places of worship, each non-domestic property has a rateable value which is set by the Valuation Office Agency (VOA). Billing authorities work out the business rates liability for every hereditament by multiplying the rateable value of the property by the appropriate multiplier. There are two multipliers, the non-domestic multiplier and the small business non-domestic rate multiplier. The former is higher because it includes a supplement which is used to fund the Small Business Rate Relief scheme, which is designed to help small businesses meet the cost of their business rates.

The multipliers are set each financial year for England according to formula set by legislation, which, from 2018-19 have been determined by the increase in the previous September’s Consumer Price Index. Government can then cap the multiplier, and compensate authorities for the loss of income through Section 31 grant.

In addition to the Small Business Rate Relief scheme, rateable properties may also be eligible for other discounts or reliefs on their business rates bills. Some of these are mandatory i.e. they are automatic entitlements in any billing authority area, and some are discretionary relief which are granted at a billing authority’s discretion. New reliefs have been introduced since the start of this series, and some of these reliefs are time limited, as a result changes across years are not strictly comparable. Further information about the types of reliefs available are presented in Table 2.

Further details about the business rates retention scheme and an explanation of hereditaments can be found in the Definitions section of the accompanying technical document.

2.1 Special factors since 2018-19

Revaluation and transitional relief

Every few years, the government adjusts the rateable value of business properties to reflect changes in the property market. This is known as a revaluation. At revaluation, the government also revises the non-domestic and small business non-domestic multipliers to reflect the aggregate change in rateable values. The latest revaluation came into effect on the 1 April 2017 and reflected the rental market as at 1 April 2015.

At a revaluation, the government also puts in place a transitional scheme that protect small and medium business ratepayers from significant step-changes in bills, by phasing-in increases over a number of years. The net transitional arrangements shown in Table 1 reflects the difference between revenue foregone and additional revenue collected, because the rates bills of ratepayers are being phased up or down as a result of the transitional scheme.

The transitional relief scheme for the 2017 Revaluation was set for 5 years, ending in 2021-22. As there has been no revaluation in 2022, authorities can instead grant transitional relief as part of the discretionary supporting small business relief.

Small business rates relief

In the 2016 Budget, government announced a permanent doubling of small business rates relief and changes were made to the thresholds, meaning that 100% relief is given to all businesses that have a rateable value of below £12,000, and tapering of the relief for businesses with a rateable value between £12,000 and £15,000. This was previously a temporary doubling that required an extension each year. The threshold at which a higher multiplier is applied was increased from £18,000 (or £25,500 in Greater London) to £51,000.

Multipliers

In the Autumn 2017 Budget, government announced that the multipliers would increase in line with the Consumer Price Index rather than the Retail Price Index. Further details of the national multiplier and small business rate multiplier and the new reliefs can be found in the technical notes accompanying this release.

2.2 Special factors affecting 2021-22 and 2022-23

Business rates multiplier

The business rates multiplier was capped in the 2021 Spending Review for 2022-23 at the same level it was in 2021-22. The amount in 2021-22 was itself capped at the same level it was in 2020-21.

Transitional relief

The transitional relief scheme for the 2017 Revaluation was set for 5 years, ending in 2021-22. As there has been no revaluation in 2022, authorities can instead grant transitional relief as part of the discretionary supporting small business relief.

Additional reliefs

In 2021, the Non-Domestic Rating (Public Lavatories) Bill came into force which gives public lavatories 100% relief from business rates. This relief applies retrospectively from 1 April 2020, but is only reflected in the forecast data for 2022-23.

In the October 2021 budget, the government announced the Retail, Hospitality and Leisure Business Rates Relief Scheme. This extended the retail, hospitality and leisure relief that was introduced in response to the coronavirus pandemic to 2022-23. In 2022-23, eligible properties will receive a 50% relief on business rates, up to a cash cap of £110,000 per business. The nursery relief has not been extended and so ended in 2021-22.

3. National non-domestic rates to be collected by local authorities in England 2022-23

Table 1 gives details of the amount of national non-domestic rates local authorities estimate they will collect in 2022-23 and the reliefs they will grant. The multipliers used are also shown. The national non-domestic multiplier for 2022-23 includes a 1.3p supplement to fund the Small Business Rate Relief scheme.

These amounts are not directly compared to 2021-22 or 2020-21 because the amount of relief given as part of the retail, hospitality and leisure discretionary relief differed between years.

• Local authorities estimate the non-domestic rating income for 2022-23 will be £22.5 billion. This is what authorities estimate they will collect after all reliefs, accounting adjustments and sums retained outside the rates retention scheme are taken into consideration.

• Local authorities report they will grant a total of £7.6 billion of relief from business rates in 2022-23. Of this £1.5 billion is the net cost of small business rate relief, £3.2 billion is the cost of other mandatory relief and £2.8 billion is the cost of discretionary relief.

3.1 Appeals

As part of the NNDR1 process authorities are required to make an estimate of how much income they will forego as a result of changes to rating lists, including appeals by businesses against their valuations. This includes both income not collected in year and also refunds they have to make in respect of previous years.

• Local authorities estimate the appeals provision will be £0.9 billion in 2022-23. The figure for 2022-23 represents authorities’ best estimate of the total future loss of non-domestic rates on the 2017 Rating list.

Table 1: National non-domestic rates to be collected by local authorities 2018-19 to 2022-23

	2018-19 Outturn		2019-20 Outturn		2020-21 Outturn		2021-22 Forecast		2022-23 Forecast
Gross rates payable in year	29,957		30,933		30,943	||	31,904		31,788
Net cost of Small Business Rate relief	1,258		1,415		1,601	||	1,470		1,530
Other mandatory relief	2,995		3,071		3,127	||	3,089		3,196
Discretionary relief(a),(b)	229		603		11,303	||	5,948	(R)	2,821	(R)
Total cost of reliefs	4,483		5,089		16,031	||	10,507	(R)	7,547	(R)
Gross Rates Payable in year less total cost of reliefs	25,474		25,844		14,912	||	21,397	(R)	24,241	(R)
Net cost of transitional arrangement(b)	-5		83		192	||	58		–
Net Rates Yield (Gross Rates Payable plus net cost of Transition)	25,470		25,927		15,104	||	21,445	(R)	24,241	(R)
Accounting Adjustments
Losses in collection(c)	181		300		860	||	653		500
Net addition to appeals provision(d)	114		-20		970	||	1,162		878
Interest payable	0		0		0	||	–		–
Total cost of accounting adjustments	295		280		1,831	||	1,815		1,378
Other deductions from collectable rates(e)	91		179		288	||	154		96
Disregarded Amounts
Amounts retained in respect of Designated Areas	52		83		63	||	100		109
Amounts retained in respect of Renewable Energy schemes	65		72		85	||	87		92
Amounts retained in respect of Shale Gas	0		0		0	||	0		0
Total Disregarded Amounts	117		155		147	||	187		201
Non-domestic rating income from rates retention scheme (Net Rates yield less Accounting adjustments, Other deductions & Disregarded amounts)	24,966		25,313		12,838	||	19,289	(R)	22,566	(R)

	2018-19(f)		2019-20(g)		2020-21(h)		2021-22(i)		2022-23(j)
Small business rate multiplier (pence)	48.0		49.1		49.9		49.9		49.9
National non-domestic rates multiplier (pence)	49.3		50.4		51.2		51.2		51.2
Number of hereditaments on rating list as at 30 Sept (`000s)	1,882		1,942		1,976		1,996		–
Total aggregate rateable value of all hereditaments on rating list as at 30 Sept (million pounds)	63,213		63,637		64,045		63,910		63,634

Footnotes to Table 1

Source: Outturn data are taken from auditor confirmed NNDR3 forms, forecast data are taken from NNDR1 forms.
(R) = 2021-22 figures revised since the previous national non-domestic rates forecast release to include an additional data collection exercise published in August 2021. 2022-23 figures reivsed following corrections from authorities.
(a) This total includes the expanded retail discount and nursery reliefs introduced in response to the coronavirus pandemic. For 2021-22, this reflects both the data reported on the NNDR1 2021-22 and the data reported in an additional exercise which was published in August 2021.
(b) The transitional relief scheme from the 2017 revaluation expired in 2021-22. In 2022-23, authorities can give the same support to businesses with the supporting small business relief (a discretionary relief), and so what would normally be the cost of the transitional scheme is included in the Discretionary Reliefs figure.
(c) Losses in collection - write offs are not included in the Total cost of Accounting Adjustments.
(d) The outturn data for net addition to appeals is systematically lower than the forecast data as local authorities do not forecast reductions in the appeals provision.
(e) Other deductions from collectable rates includes an allowance for cost of collection & legal costs, a special authority deduction for the City of London, and the net cost of transitional protection payments made to authorities to reverse the effects of transitional arrangements.
(f) 2018-19 VOA Data as at 1 April 2017.
(g) 2019-20 VOA Data as at 3 October 2018.
(h) 2020-21 VOA Data as at 3 October 2019.
(i) 2021-22 VOA Data as at 7 October 2020.
(j) 2022-23 VOA data as at 15 October 2021. Data on number of hereditaments is suppressed due to ongoing validation checks and will be included in an update to this release.

4. Reliefs to be granted by local authorities in 2022-23

Table 2 shows figures for mandatory and discretionary reliefs billing authorities expect they will grant in 2022-23. Mandatory reliefs are automatic entitlements in any billing authority area whereas discretionary reliefs are granted at a billing authority’s discretion.

• Of the estimated £7.6 billion relief to be granted from business rates, £3.2 billion is mandatory relief excluding small business rate relief, which consists primarily of charity and empty premises relief.

• Authorities estimate they will grant £2.2 billion relief under the Small Business Rate relief scheme for 2022-23, whilst receipts from the supplement paid by some businesses to fund the Small Business Rate relief scheme in 2022-23 are expected to be £629 million. This gives a net cost of the scheme of £1.5 billion.

• Authorities estimate the amount of relief to be granted to empty premises in 2022-23 will be £1 billion.

• Total relief provided to charitable occupations (that is both mandatory and discretionary relief) is expected to amount to £2.1 billion in respect of 2022-23, and these reliefs account for 28% of the total relief to be granted.

• Local authorities expect to grant a total of £2.8 billion discretionary relief in 2022-23. Of the discretionary relief, £2.7 billion is the cost of the retail, hospitality and leisure relief. The retail, hospitality and leisure relief accounts for 36% of the total relief to be granted.

Table 2: Cost of reliefs from national non-domestic rates: 2018-19 to 2022-23

	2018-19 Outturn		2019-20 Outturn		2020-21 Outturn		2021-2022 Forecast		2022-23 Forecast
MANDATORY RELIEFS
Small Business Rate Relief
In respect of current year
Relief provided in year	1,820		1,970		2,100	||	2,103		2,159
of which: relief on existing properties where a 2nd property is occupied	4		4		5	||	4		3
Additional yield generated from the small business supplement	631		633		630	||	633		629
Net cost of small business rate relief in respect of current year	1,190		1,338		1,470	||	1,470		1,530
Net cost of small business rate relief in respect of previous years	68		77		131	||	–		–
Net cost of small business rate relief	1,258		1,415		1,601	||	1,470		1,530
Other Mandatory reliefs
In respect of current year
Charitable occupation	1,933		2,011		2,021	||	2,015		2,027
Community Amateur Sports Clubs (CASCs)	20		21		22	||	21		21
Rural rate relief	4		4		4	||	4		4
Telecomms relief(a)	0		0		0	||	0		–
Public Lavatories relief	–		–		–	||	–		5
Partially occupied hereditaments	24		26		22	||	15		17
Empty premises	996		1,006		1,082	||	943		1,048
Total other mandatory relief in respect of current year	2,789		3,069		3,151	||	2,997		3,122
Other mandatory relief in respect of previous years	18		2		-24	||	–		–
Changes as a result of local estimates of growth or decline in mandatory relief	–		–		–	||	92		74
Total cost of other mandatory relief	2,782		3,071		3,127	||	3,089		3,196
Total cost of mandatory relief	4,253		4,486		4,728	||	4,559		4,726
DISCRETIONARY RELIEFS
In respect of current year
Charitable occupation	47		48		42	||	46		47
Non-profit making bodies	38		37		31	||	33		34
Community Amateur Sports Clubs (CASCs)	1		1		1	||	1		1
Rural rate relief(a)	0		0		0	||	0		0
Small rural businesses	1		1		1	||	1		1
Other ratepayers under s47	21		22		20	||	19		19
Hardship relief	2		2		3	||	–		–
Total discretionary relief in respect of current year	110		112		98	||	100		102
Discretionary relief in respect of previous years	5		3		1	||	–		–
Discretionary reliefs funded through Section 31 grants
Flooding relief	0		2		1	||	–		–
Rural Rate relief	4		4		4	||	4		5
Local Newspaper Temporary relief(a)	–		0		0	||	0		0
In Lieu of Transitional Relief	–		–		–	||	–		–
Supporting Small Businesses relief(b)	14		13		13	||	13	||	45
Discretionary Scheme relief	77		30		3	||	–		–
Pub relief	17		–		–	||	–		–
Retail, hospitality and leisure relief(c),(d)	–		432	||	11,061	||	5,757	(R)||	2,665	(R)
Nursery relief(d)	–		–		98	||	68	(R)	–
Total cost of discretionary reliefs funded through S31 grant	113		481	||	11,180	||	5,843	(R)||	2,714	(R)
Discretionary relief funded through S31 grants in respect of previous years	1		7		25	||	–		–
Changes as a result of local estimates of growth or decline in discretionary relief	–		–		–	||	5		4
Total cost of discretionary relief	229		603	||	11,303	||	5,948	(R)||	2,821	(R)
TOTAL COST OF ALL RELIEFS	4,483		5,089	||	16,031	||	10,507	(R)||	7,547	(R)

Footnotes to Table 2

Source: Outturn data are taken from auditor confirmed NNDR3 forms, forecast data are taken from NNDR1 forms.
(R) = 2021-22 figures revised since the previous national non-domestic rates forecast release to include an additional data collection exercise published in August 2021. 2022-23 figures reivsed following corrections from authorities.
(a) Value below £0.5 million.
(b) In 2022-23, the Supporting Small Business Relief also includes any discretionary relief given to businesses as transitional relief. This is because the transitional relief scheme from the 2017 revaluation expired at the end of financial year 2021-22.
(c) In 2019-20, this was a discount of one third of the non-domestic rates bill for retail shops, restaurants pubs and cinemas with a rateable value of £51,000 or less (also referred to as retail discount relief). In 2020-21 this was expanded in response to the coronavirus pandemic to provide a 100% relief to all retail, hospitality and leisure businesses. In 2021-22 the relief gave a 100% discount for the first 3 months and then a 66% discount for the remaining months with a cap on the relief for each business, and in 2022-23 it is a 50% discount with a cap on the relief.
(d) The retail, hospitality and leisure relief figures for 2021-22 were collected in an additional data collection exercise published in August 2021.

5. Reliefs to be funded by Section 31 grants

Since 2013-14, a number of measures have been announced by the Chancellor in Autumn Statements and Budgets which have made changes to the national non-domestic rates scheme. Central government compensates local authorities for these changes and this compensation is made outside of the rate retention scheme by means of a Section 31 (S31) grant. The grants are given to local authorities to fund activities which are not covered by existing payment schedules or methods. Details on the measures in table 3 can be found in the technical notes published alongside this release.

The amounts shown in Table 3 are the Section 31 grant to be paid to local authorities to compensate them for the loss of income arising from the measures listed. They differ from the amounts shown in Table 2 which show the total amount of relief to be granted to business ratepayers under each of the measures as they exclude the central government share of the reliefs.

Since 2017-18, some authorities have been able to retain more than a 50% share of the income, and therefore will be compensated for more of the relief. Additionally, single year rate retention pilots took place in 2018-19 and 2019-20, where different authorities and different percentage shares were involved. Therefore, year-on-year changes in each measure are not directly comparable.

Table 3 shows the Section 31 grants paid to local authorities from 2018-19 to 2020-21 and what authorities expect to be paid in 2021-22 and 2022-23.

Following the publication of 2021-22 NNDR1s, the government announced that the retail discount and nursery reliefs would be extended into 2021-22. Billing authorities were asked to provide an estimate of the additional reliefs they anticipated giving through an additional data collection exercise. As with the same relief in 2020-21, billing authorities were then awarded on-account s.31 payments equal to the full amount of those estimates due to the size of the relief being given and the financial pressures that authorities would be under by providing these reliefs. The s.31 awards will be reconciled following the submission of 2021-22 NNDR3s and, as normal, local government’s final compensation will reflect only their share of the lost income resulting from reliefs. Therefore the on-account s.31 payments for the 2021-22 relief have been excluded from the table. The table includes the amount of s.31 grant for 2020-21 as this reconciliation has been reported in the 2020-21 NNDR3s.

Table 3: Section 31 grants due to authorities for national non-domestic rates measures 2018-19 to 2022-23

	2018-19 Outturn		2019-20 Outturn		2020-21 Outturn		2021-2022 Forecast		2022-23 Forecast
a - Capping the increase in the small business rates multiplier(a)	471	||	582	||	323	||	820	||	1,445	(R)
b - Cost of doubling SBRR and threshold changes	1,065	||	1,054	||	1,014	||	972	||	1,041
c - Maintaining small business rates relief on “first” properties	4	||	3	||	5	||	2	||	2
d - Relief to newly built properties	0	||	0	||	0	||	–	||	–
e - Relief awarded on the occupation of “long-term empty” properties(d)	0	||	0	||	0	||	–	||	–
f - Retail relief(b)	0	||	6	||	4	||	–	||	–
g - Flooding relief	0	||	1	||	1	||	–	||	–
h - Rural Rate relief	3	||	3	||	2	||	2	||	3
i - Local Newspaper Temporary relief(c)	0	||	0	||	0	||	0	||	0
j - In Lieu of Transitional relief(c)	0	||	0	||	0	||	–	||	–
k - Supporting Small Businesses relief(d)	12	||	9	||	8	||	8	||	29
l - Discretionary Scheme relief	68	||	21	||	-1	||	–	||	–
m - Pub relief	13	||	0	||	0	||	–	||	–
n - Enterprise Zone relief provided in 100% Pilot Areas	11	||	5	||	3	||	4	||	2
o - Telecomms relief(c)	0	||	0	||	0	||	0	||	–
p - Retail, hospitality and leisure relief(e),(f)	–	||	308	||	7,117	||	–	||	1,832	(R)
q - Nursery Relief(f)	–	||	–	||	62	||	–	||	–
r - Public Lavatories relief	–	||	–	||	–	||	–	||	3
Total amount of reliefs funded by Section 31 grants	1,645	||	1,991	||	8,538	||	1,809	||	4,358	(R)

Footnotes to Table 3

Source: Outturn data are taken from auditor confirmed NNDR3 forms, forecast data are taken from NNDR1 forms.
Note: Since 2017-18 some authorities have been able to retain more than a 50% share of income. The amount of share and authorities involved have change from year to year, and so annual figures are not directly comparable.
(R) = 2021-22 figures revised since the previous national non-domestic rates forecast release to include an additional data collection exercise published in August 2021. 2022-23 figures reivsed following corrections from authorities.
(a) The relief in respect of capping the small business rates multiplier is particularly high in 2021-22 and 2022-23 when the multiplier was frozen at 49.9p. This means the difference between the multiplier and what it would have been without the cap increased more than usual in those years.
(b) The level of retail relief was changed from £1,000 per qualifying property in 2014-15 to £1,500 per qualifying property in 2015-16. It is not available from 2016-17 onward.
(c) Value below £0.5 million.
(d) In 2022-23, the Supporting Small Business Relief also includes any discretionary relief given to businesses as transitional relief. This is because the transitional relief scheme from the 2017 revaluation expired at the end of financial year 2021-22.
(e) In 2019-20, this was a discount of one third of the non-domestic rates bill for retail shops, restaurants pubs and cinemas with a rateable value of £51,000 or less (also referred to as retial discount relief). In 2020-21 this was expanded in response to the coronavirus pandemic to provide a 100% relief to all retail, hospitality and leisure businesses. In 2021-22 the relief gave a 100% discount for the first 3 months and then a 66% discount for the remaining months with a cap on the relief for each business, and in 2022-23 it is a 50% discount with a cap on the relief.
(f) The total figure for 2021-22 does not include the compensation for the expanded retail discount and nursery reliefs. This is because the full amount of relief was paid to authorities, which will then be reconciled to reflect the amount actually due to authorities during the out-turn process. The figures will be calculated and reported in the NNDR3 for 2021-22.

6. Accompanying tables and open data

6.1 Symbols used

… = not available
0 = zero or negligible (usually less than 0.5 million)
- = not relevant
|| = a discontinuity in data between years

6.2 Rounding

Where figures have been rounded, there may be a slight discrepancy between the total and the sum of constituent parts.

7. Tables

Accompanying tables are available to download alongside this release. These include Tables 1 to 3 for England. Table 4 with the number of hereditaments in receipt of mandatory and discretionary rate relief and data for individual local authorities will be available in a later update in March.

8. Open data

These statistics are available in fully open and linkable data formats.

9. Technical notes

Please see the accompanying technical notes document for further details.

Information on Official Statistics is available via the UK Statistics Authority website.

Information about statistics at DLUHC is available via the Department’s website.