Business rates

Business or national non-domestic rates are administered separately in different parts of the UK. Rates are calculated using the rateable value of a property and a multiplier set by the government of each nation. Valuations are generally undertaken every five years and based on the open market rental value of a property.

What business rate reliefs can museums benefit from?

Certain types of museums may be eligible for a relief of up to 100% on business rates. These key reliefs apply across the UK.

Mandatory rate relief

Museums that are registered charities or charitable trusts are eligible for a mandatory relief of 80% from business rates levied on their premises, as long as the property is wholly or mainly used for charitable purposes. The concession is the same across the UK and the savings this generates can be reinvested in the service. This is an important consideration for museums investigating a move to trust status.

Discretionary rate relief

Charitable and other non-profitmaking organisations are also entitled to a discretionary rate relief of up to 20%, which is granted by the local authority. For charities, this concession is a top-up of the mandatory relief, meaning they can benefit from a reduction of up to 100%.

Discretionary rate relief is available in the following instances:

  • where the rate payer is a charity or trustee for a charity and the rateable property is wholly or mainly used for charitable purposes
  • where the rateable property is occupied for the purposes of one or more institutions or organisations, none of which is conducted for profit and of which the main objectives of each are charitable or otherwise philanthropic, religious, or concerned with education, social welfare, science, literature or the fine arts; and
  • where the rateable property is wholly or mainly used for purposes of recreation and all or part is occupied for the purposes of a club, society or other organisation, not established or conducted for profit

What affects a property’s rateable value?


Making changes to your museum may affect the rental value of the property, which can have an impact on the business rates you pay. This is important to bear in mind when considering future planning, particularly capital projects to either renovate the building or build a purpose-built store (which may be rated as a separate business unit). If you disagree with a ratings assessment following a revaluation, you are entitled to appeal – contact the relevant agency in each nation for more details (see below).

Revaluations

The next revaluation of non-domestic properties in England, Wales and Scotland is due to take place in 2017. A revaluation is currently underway in Northern Ireland and rates bills with these new values will be issued from 1 April 2015.

*Related news*

In England and Wales, the Local Government Finance Act 2013 introduced a Business Rates Retention Scheme from April 2013, which gives local authorities an opportunity to retain 50% of the business rates they levy rather than sending them back to central government. There are concerns this could have an impact on discretionary reliefs, as it creates a more direct link between the rebate and the local authority and could lead to some councils deciding to discontinue the concession.

General links and resources

For valuation queries: