Non-Domestic Rates changes in the 2023 financial year
01 April 2023 brings significant changes to the Non-Domestic rating system in Scotland. This section will explain what these changes are and how they will affect the issue of your rates bill.
In addition to all subjects being revalued by the Orkney and Shetland Valuation Joint Board ("the Assessor") for the first time since 2017, there are significant changes to some relief schemes. More details on the relief schemes and other notable changes can be found further down this page.
These relief schemes introduce some new complexities and we are currently working with our software suppliers to enable these reliefs to be available to qualifying ratepayers as soon as possible. However this may not be possible in time for the issue of annual rates bills that must be sent out before mid-April, to allow monthly instalments to commence in May.
We will strive to have as many bills showing your full relief entitlement as possible but may not be able to include Transitional Relief or Small Business Bonus
It is our intention that a subsequent bill with all relief awarded will be issued in late May or early June. The reasons that we are taking this action rather than delaying the issue of bills is as follows;
Not all ratepayers will be affected; most will receive an accurate bill.
It avoids ratepayers having higher monthly instalments that would apply if we delayed billing.
We can accept repayment arrangements based on estimated charges if necessary.
We can, and will, delay any recovery action so that those who wish to wait for their amended bill can do so without fear of demands for payment being received.
All awards of Small Business Bonus Scheme Relief have been cancelled from 31/03/2023 and application forms for the new scheme issued with the Annual Bills.
It is essential that these applications are completed and returned to us as soon as possible to allow us to issue updated bills.
The following changes will take effect from 01 April 2023
The Rate poundage
The rate poundage and supplements are set annually by the Scottish Government and apply across Scotland.
For financial year 2023 the poundage is unchanged from 2022 at 49.8 pence per pound of rateable value.
An intermediate supplement will mean that an additional 1.3 pence above the rate poundage (giving a total of 51.1p) will apply where the rateable value is between £51,001 and £100,000
A large business supplement will mean that an additional 2.6 pence above the rate poundage (giving a total of 52.4p) will apply where the rateable value exceeds £100,000
A search facility is available on the Scottish Assessors website to view the rateable value of any subjects liable for Non-Domestic Rates.
Amendments to the eligibility criteria for relief under the Small Business Bonus Scheme
There are to be new qualifying thresholds and a difference in the amount of relief available for ratepayers of single or multiple premises.
In addition to existing exclusions for empty premises and premises used for pay day lending, there will be further restrictions on car parks, parking spaces and advertising.
Transitional Relief awards to support those seeing a rise in charges due to revaluation
A revaluation of all Non-Domestic rates subjects will take effect from 01 April 2023; the first such revaluation since 2017.
Rates relief schemes have been introduced to support those that will see a significant rise in the amount payable because of this.
There will be a general scheme based on increases in rateable value, a scheme for those losing certain relief awards and a scheme for premises being charged rates for the first time.
Further details are available below relating to Transitional Relief
For more general information on all valuation matters, please visit the Scottish Assessors Association website.
Rates payable on empty premises
As of 01 April 2023 each Local Authority in Scotland has full autonomy in choosing to set a reduced charge for premises that are empty
For financial year 2023, Shetland Islands Council have chosen to replicate the previous schemes in place up to 31 March 2023, although this will be reviewed within this financial year.
Extension to Day Nursery relief
Rates relief scheduled to end as of 30 June 2023 has now been extended indefinitely.
Enhancement to Fresh Start Relief
The upper rateable value threshold to be eligible for Fresh Start relief has been increased from £95,000 to £100,000
In addition to this, anyone receiving Fresh Start relief on 31st March 2023 will continue to receive relief for the remaining duration of the eligibility period regardless of whether the new rateable value is above the threshold.
New and Improved Property Relief (the Business Growth Accelerator)
Any ratepayer in receipt of New and improved Property relief on 31st March 2023 will continue to be eligible for an equivalent percentage of relief on the new rateable value for the remainder of their eligibility period.
Transitional Relief for financial years 2023 to 2026
Provisions have been made by the Scottish Government to limit the increase in Non-Domestic Rates charges, resulting from the 2023 revaluation exercise, effective from 01 April 2023
The provisions cover:
- A general award based on an increase in rateable value
- A "cap" on the charge increase for small businesses losing entitlement to certain relief awards
- Reductions for premises located on parks and being charged rates for the first time
General Revaluation Transitional Relief
This relief, where there is entitlement, will be automatically awarded to your Non-Domestic rates account as soon as we have the updated software to allow us to do so, no application is required.
For the 2023 Revaluation cycle, the following limits will apply to the increases in gross charges from the position as at 31st March 2023.
The gross charge for the purposes of this relief is the rateable value on that day multiplied by a poundage factor; the poundage factor being the non-domestic property rate for that year - either the Basic Property Rate, Intermediate Property Rate of Higher Property Rate, as the case may be.
Year-on-year Scottish 2023 Revaluation Transitional Relief caps (%)
Rateable Value (per property)
2023 to 2024
Up to £20,000
£20,001 to £100,000
In order to be eligible for this relief, the property requires to have been shown in an entry on the valuation roll on both 31 March 2023 and 1 April 2023. Properties with a nil rateable value on 1 April 2023, or which had a nil rateable value on 31 March 2023 are not eligible
Small Business Transitional Relief
A Small Business Transitional Relief capping the maximum increase in the net rates liability relative to 31 March 2023 at £600 in 2023‑24, after any relief, is available for properties where;
- they were entitled to Small Business Bonus Scheme Relief on 31 March 2023 and/or
- were entitled to mandatory or discretionary Rural Relief on 31 March 2023 and
- are no longer entitled on 1 April 2023
In order to be eligible for this relief, the property requires to have been shown in an entry on the valuation roll on both 31 March 2023 and 1 April 2023. Properties with a nil rateable value on 1 April 2023, or which had a nil rateable value on 31 March 2023 are not eligible.
This relief must be applied for, the application is included within the Small Business Bonus Scheme application form.
Parks Transitional Relief
A 'Parks' Transitional Relief provides for a 67% relief award for parts of parks that existed but were exempt from valuation for Non-Domestic Rating on 31 March 2023, and which become rateable on 1 April 2023
This relief must be applied for.