Why are business rates back in focus for UK companies?
From April 2026, many firms will see an increase in their business rates bills. But unlike other cost pressures, this one isn’t a surprise. The end of transitional relief and the impact of the 2023 revaluation are already mapped out, giving directors a clear window to plan ahead.
According to City A.M. (26 August 2025), business rates changes 2026 could cost English businesses £billions over the next three years. But, as one of our partners, Nitin Joshi, suggests, with early forecasting and proactive cashflow management, directors can stay ahead of the curve.
What’s changing with business rates in April 2026 — and how can directors prepare?
Two key changes are coming:
- Revaluation impact: Business rates are now based on 2021 property values, which reflect a post-COVID bounce. Many premises, especially in retail and hospitality, are now rated higher than before.
- End of transitional relief: Since 2023, increases have been phased in. From April 2026, full liability applies. That means no more cushioning – just the full bill.
For some businesses, this will be a modest adjustment. For others, particularly those with fixed premises and tight margins, it is a cost that needs to be built into next year’s planning as soon as possible.
Which sectors, in particular, should be reviewing their forecasts now?
The revaluation affects some key sectors, including:
- Retail and hospitality: High Street shops, pubs and restaurants with prime locations
- Logistics and warehousing: Larger premises with increased demand during the pandemic
- Professional services in city centres: Firms with long leases in high-value areas
If your business falls into one of these categories, now is the time to revisit your rateable value, check your Valuation Office Agency listing and factor the full liability into your 2026 cashflow.
How do business rates fit into wider financial planning?
Unlike staffing or marketing costs, business rates are fixed and predictable. That makes them ideal for forward planning. Directors who build rates into their forecasts now can:
- Avoid sudden cashflow pressure
- Maintain creditor confidence
- Keep options open for restructuring or refinancing if needed
At Antony Batty & Company, we encourage directors, especially those whose companies are under financial pressure. to treat rates as part of their strategic planning – not just a line item on the balance sheet.
As Nitin points out:
“Business rates are a real thing. We find that businesses often tend to put them at end of the queue, focusing instead on looking after suppliers. This can be terminal. Just a few weeks ago, for example, a well-established prestige builder in the Buckinghamshire and Hertfordshire area had to enter liquidation because they mismanaged their rating liability.”
Is government support likely before 2026?
It’s possible, but not guaranteed. While transitional relief was extended in 2023, there’s no current indication of further support. The Treasury is under pressure to maintain revenue, and reforms may take time.
Our advice: plan for full liability. If relief is announced, it’s a bonus – not a strategy.
What practical steps can directors take now?
Here’s a proactive checklist:
- Review your rateable value: Appeal if appropriate
- Update your cashflow forecasts: Include April 2026 rates
- Talk to your accountant or adviser: Build rates into your financial model
- Engage with creditors early: If rates will affect your ability to meet other obligations, start the conversation now
- Explore restructuring options: Company Voluntary Arrangements (CVA) or Company Administration may be viable – but the earlier you act, the better
Can a CVA help manage business rates liabilities?
Yes, in the right circumstances. A Company Voluntary Arrangement allows directors to restructure unsecured debts, including business rates, over time. Success depends on:
- Creditor support
- Timing
- Professional input
We have seen CVAs work well in retail and hospitality, for example, especially when directors act before pressure builds.
What if the business is solvent but no longer viable or wanted?
A Members’ Voluntary Liquidation (MVL) may be appropriate. It allows directors to:
- Close the company in an orderly way
- Distribute assets tax-efficiently
- Avoid future liabilities, including rates
But timing is key. Once liabilities exceed assets, MVLs are no longer an option, and a liquidation becomes likely.
What is the takeaway for directors with Business Rates in 2026?
Business rates in 2026 are a known quantity. That makes them manageable – if you plan ahead. Whether your business is growing, consolidating, winding down or heading for financial difficulties, the key is to act early and build rates into your strategy.
At Antony Batty & Company, we help directors take control of their options – clearly, personally and practically. The sooner you talk to us, the more we can do to help.
