Pubs sit at the heart of our communities, but the rising costs are continuing to put pressure on our local businesses and the hospitality sector.
The Autumn Budget’s changes to business rates have faced ongoing backlash and the Government has decided to do something about it.
In a surprise U-turn, they have announced a 15 per cent reduction in business rates for pubs and pub owners must be clear on what this means for them and how they can benefit from the available reliefs.
What are business rates?
Business rates are taxes charged on most non-domestic properties, including pubs.
They are calculated based on the property’s rateable value, which is set by the Valuation Office Agency (VOA).
Your business rates bill is calculated by multiplying the rateable value by a multiplier, set annually by the Government.
There are two main multipliers, this includes:
- The standard multiplier
- The small business multiplier, which applies to lower-value multipliers
What are the changes to business rates?
The Autumn Budget 2025 brought several changes to business rates and the Government announced that the annual business rates multiplier in England will reduce by between 11.7 per cent and 13.5 per cent.
However, rising rateable values and tapering reliefs will mean that many businesses are once again faced with costly bills.
From April 2026, Retail, Hospitality and Leisure (RHL) relief will also reduce once again.
Properties with a rateable value of up to £51,000 will receive around 20 per cent relief, while those between £51,000 and £500,000 will receive 10 per cent relief.
This follows on from a sharp reduction in the relief from 75 per cent to 40 per cent in 2025/26 and may come as a shock to many pub owners.
Larger properties with a rateable value above £500,000 will also face a super supplement of around 5.8 per cent, which will increase their liabilities even further.
How is the Government supporting pubs?
The Budget’s reforms received backlash from many businesses and the Government has recently announced a new lifeline for pubs and live music venues.
From April 2026, eligible pubs will now receive a 15 per cent cut to their new business rate bills and this will be frozen for two years.
The Government has also committed to a review of how pubs are valued before the next revaluation in 2029.
How can pubs prepare for these changes?
With the changes to rates and reliefs fast approaching, pubs must prepare now to avoid unexpected costs and protect their cash flow.
Pub owners must:
- Review how their rateable value has been calculated and whether it reflects the current trading conditions
- Check their rates bills to see if all available reliefs have been applied correctly
- Factor in the expiry of temporary reliefs when forecasting their cash flow
- Budget for potential increases, especially if the property rises above the £500,000 threshold
How can pubs move forward?
The new support provides short-term breathing space, but it does not fix the underlying problems in the business rates system.
Pubs should make the most of the reduction and seek financial support to ensure they are receiving all available reliefs.
Our professional team can support you with budgeting and cash flow forecasts to help your business thrive during these challenging times.
