Around £1.8 billion of business rates payments are expected to be handed back to firms, according to Government figures.
Modelling by the Treasury has indicated it expects significant rebates in the face of changes to business rates valuations, which are due to take force at the start of the new tax year in April.
The figures were disclosed in official modelling published under the Freedom of Information Act to global tax firm Ryan.
Many firms are expecting to face higher bills due to updates to rateable values – the property valuations that the tax payments are based on – which come into force next month and are based on calculations from 2024.
A number of sectors, such as hotels, have said firms are expecting higher bills as a result despite a reduction in the multiplier used to calculate the property tax bills.
The fresh data for setting the latest multipliers showed that ministers have forecasted a £3.59 billion reduction in rateable value due to potential successful appeals for the 2026 local ratings lists. This is expected to result in a roughly £1.8 billion return from appeals.
Businesses can launch a check, challenge and appeal (CCA) process where they disagree with business rates calculations.
Nevertheless, corrections following appeals can take a significant time to crystalise.
Ryan said the data reveals that 8% of the projected corrections are forecast to take place in the 2026/27 financial year, with 13% of this a year later.
Alex Probyn, principal and practice leader at Ryan, said: “If a large proportion of adjustment is forecast to fall into the next rating cycle, then that has implications for certainty and planning.
“Business rates liabilities feed directly into investment and capital expenditure decisions. Timely resolution matters.”
The Government is currently consulting on the future direction of business rates through an ongoing Call for Evidence
Mr Probyn added: “The allowance for correction is already built into fiscal planning. Earlier resolution would not alter that; it would provide clarity sooner.
“If the objective is to align the system with growth and investment, the speed of outcomes under CCA is an important consideration.”
Colder and wetter weather may bring hail and thunder in ‘big change’ this week
‘I’m 50 and have been applying for jobs every day for two years’
Officer dies and another critical after collision responding to ‘immediate call’
Yvette Cooper condemns ‘reckless’ Iranian strikes on Diego Garcia
MAC entices staff to transform into TikTok live shopping hosts
UK inflation steady but experts warn of cost-of-living ‘twist’ in months ahead
