Is Your Small Business Affected by the Staircase Tax?

The Communities Secretary Sajid Javid has today published draft legislation to reverse the impact of the ‘staircase tax’ which has unfairly affected many small businesses.

The publication of the new draft legislation follows a decision in the Supreme Court which has resulted in businesses who occupied more than one property in a shared building receiving a separate rates bill for each unit - dubbed the 'staircase tax'. 

The ruling overturned an established and widely understood practice where businesses occupying two adjoining floors or two rooms separated by a wall only received a single bill.

Some businesses are now paying more overall due to the loss of small business rate relief – a 

discount applied to the bills of certain businesses with a lower rateable value.

Subject to Parliamentary approval of the Bill, those businesses who have been directly impacted by the Supreme Court judgement can ask the VOA to recalculate valuations based on previous practice. 

If successful they can then have their bill recalculated and if they choose to stick with the old method of calculation, backdated. This includes those firms who lost small business rate relief.

The department will now consult with stakeholders and experts, with a view to introducing the Bill shortly. See the consultation document.