The UK Government’s Autumn Budget 2025, along with the publication of the Draft 2026 Rating List, has introduced significant changes to the business rates landscape. These updates create a more complex system for commercial property occupiers to navigate. Understanding these changes is crucial for effective financial planning and ensuring you are not overpaying.

This post breaks down the key announcements, including the new multiplier structure, transitional relief schemes, and the impact of the revaluation on different property sectors. We will explore what these updates mean for your business and how you can prepare for the changes taking effect on April 1, 2026.

A New Multiplier Framework

One of the headline changes is the introduction of a more complex, five-tier multiplier system designed to rebalance the tax burden across different sectors and property values. The government aims to provide targeted support for the high street while funding it through a levy on the most valuable properties.

Lower Rates for Retail, Hospitality, and Leisure (RHL)

To support businesses central to the UK’s high streets, the government has created permanently lower business rates for occupied properties in the Retail, Hospitality, and Leisure (RHL) sectors. This will benefit over 750,000 properties, including shops, pubs, and restaurants.

Two new RHL multipliers have been introduced:

• Small RHL Business Multiplier: 38.2p for properties with a Rateable Value (RV) below £51,000.
• Standard RHL Multiplier: 43.0p for properties with an RV between £51,000 and £499,999.

These rates are set 5p below their national equivalents, offering a discount to eligible businesses. However, while this provides relief, it is a less generous level of support compared to previous temporary relief schemes.

A New High-Value Multiplier

To fund the RHL relief, a new, higher multiplier has been introduced for the most valuable properties. Approximately 1% of commercial properties will be affected.

• Large Multiplier: 50.8p for all properties with an RV of £500,000 or more.

This change means larger businesses, including major retailers, logistics hubs, and corporate offices, will bear a greater proportion of the overall tax burden. This is intended to shift some of the liability away from smaller high street businesses, but it will undoubtedly impact investment decisions for major employers.

The Full 2026 Multiplier Structure

Here is a summary of the five multipliers that will apply from April 1, 2026. Note that these figures do not include potential supplements like the 1p charge for transitional relief or London-specific supplements.

Multiplier Type	Criteria	2026-27 Multiplier
Small Business	RV below £51,000	43.2p
Small RHL Business	Occupied RHL, RV below £51,000	38.2p
Standard	RV between £51,000 and £499,999	48.0p
Standard RHL	Occupied RHL, RV between £51,000-£499,999	43.0p
Large	RV above £500,000	50.8p

Understanding the 2026 Revaluation and Draft List

Alongside the budget, the Valuation Office Agency (VOA) published the Draft 2026 Rating List. This revaluation assesses new Rateable Values for all commercial properties based on market conditions as of April 2024. The results show a significant overall increase in property values.

The total RV across England and Wales has risen from £70.8 billion in the 2023 list to £84.4 billion for 2026—an increase of 19.2%. This substantial rise in underlying values means that even with lower multipliers, many businesses will face higher rates bills.

Sector-Specific Impacts

The revaluation has affected different sectors in varied ways, reflecting their performance and rental growth between 2021 and 2024.

• Industrial and Logistics: This sector saw one of the largest average increases, with RVs rising by 21.1%. The sustained demand for warehouse and distribution space has driven values up, and these businesses will feel the impact of the revaluation significantly.
• Offices: The office sector experienced an average RV increase of 14.3%. London offices saw a particularly sharp rise, contributing to the region’s overall 22.3% increase in total RV. This reflects a recovery in prime office rents despite shifts in working patterns.
• Retail: The retail sector saw a more modest average increase of 9.3%. While some relief is provided through the RHL multiplier, the underlying RV increases will offset some of those gains, especially for larger stores falling into the new high-value multiplier category.
• Other Sectors: The “Other” category, which includes properties like airports, hotels, and arenas, saw the largest overall increase at 28.2%. Airports, in particular, saw a dramatic rise in their RVs, reflecting a recovery from the pandemic.

 

Navigating Transitional Relief

To prevent sudden and dramatic bill increases following the revaluation, the government has implemented a £3.2 billion Transitional Relief scheme. This scheme caps the percentage by which your bill can rise each year until 2029.

The caps are tiered based on your property’s Rateable Value:

Rateable Value (RV)	2026-27 Cap	2027-28 Cap	2028-29 Cap
Small (up to £20k / £28k in London)	5%	10%	25%
Medium (£20k-£100k)	15%	25%	40%
Large (over £100k)	30%	25%	25%

While this relief provides a degree of predictability, the system is complex. The caps are applied to your notional liability before other reliefs are considered, and a 1p supplement may be added to bills for businesses not receiving transitional or small business relief. Correctly calculating your future liability requires a thorough understanding of these interacting schemes.

Additionally, a Supporting Small Business (SSB) scheme will cap bill increases at £800 for those losing some or all of their previous small business or retail reliefs.

What Should Your Business Do Now?

The combination of a new multiplier framework, a significant revaluation, and complex relief schemes makes proactive management of your business rates essential. With the Draft 2026 Rating List now public, you have an opportunity to review your new Rateable Value and prepare for the financial impact.

1. Check Your Draft Rateable Value: The first step is to find your property on the VOA website and check the proposed 2026 RV. Ensure the details held by the VOA about your property are accurate.
2. Budget for the Changes: Use your new RV and the appropriate multiplier to forecast your estimated rates bill for 2026-27. Remember to factor in transitional relief and any other applicable schemes.
3. Seek Professional Advice: The business rates system has become even more complicated. An incorrect valuation or a misunderstanding of the relief schemes could cost your business thousands. Engaging with a surveyor ensures your liability is correctly assessed and that you benefit from every available relief.

 

Let Hanway Commercial Guide You

The changes from the Autumn Budget 2025 confirm that navigating business rates is more challenging than ever. At Hanway Commercial, our team of expert surveyors has an in-depth understanding of the revaluation process, the new multiplier system, and the intricacies of transitional relief.

We can provide tailored advice on how these changes will affect your property portfolio, help you budget accurately, and ensure that your Rateable Value is fair. Contact our team today to start preparing for April 2026 and secure peace of mind.