What changes on 1 April 2027
The detail is in the government’s business rates information letter of 28 October. For England, it includes:
- Higher Small Business Rates Relief (SBRR) thresholds for qualifying retail, hospitality and leisure (RHL) properties. Full relief now applies up to a rateable value (RV) of £18,000, up from £12,000. Relief then tapers away evenly to nothing at £21,000, up from £15,000. These thresholds run until 31 March 2029.
- Pub relief up from 15% to 35% for 2027/28 and 2028/29. It covers pubs, social clubs and all but the largest live music venues.
- A real-terms freeze. Eligible RHL, pub and music venue bills will be capped at CPI inflation in 2027/28 and 2028/29. The cap doesn’t cover increases caused by your own improvements, or the loss of other reliefs.
- New multipliers. For 2027/28 these are 39.5p small business RHL, 44.5p standard RHL and 52.5p for properties with an RV of £500,000 or more.
Rates are devolved, so none of this applies in Scotland, Wales or Northern Ireland.
Where small independents come out ahead
The SBRR change is aimed squarely at smaller properties. The BII says the rise in the threshold to £18,000 means 3,500 more pubs will pay no business rates. It also points out that many of them were only brought into paying rates by the steep rises in rateable values at the April 2026 revaluation.
A simple illustration, our own sums. Take a single free house with an RV of £17,000 that currently pays rates. In 2026/27, at the 38.2p small business RHL multiplier less 15% pub relief, that’s about £5,520 a year. From April 2027, if it qualifies for SBRR, it falls inside full relief and the bill should drop to nothing. This leaves out transitional relief, the supplement and any other adjustments. SBRR also has its own eligibility rules, including on any other properties you occupy. Check your own position with your council.
There’s a smaller change that matters to operators with a second site. The RV limit for other properties you occupy, used when deciding SBRR on your main property, becomes a single £29,999 threshold across England. At the moment it’s £27,999 in London and £19,999 elsewhere.
Where the bigger operators benefit too
This is where the “levelling the field” argument gets weaker. Two of the main measures apply whatever the size of the business:
- Pub relief at 35% applies to pubs regardless of RV. The only carve-out is for live music venues with an RV of £1m or more, which stay at 15%.
- The CPI freeze applies to qualifying RHL properties with, as the government’s technical note says, “no rateable value limit”.
So a high-street pub owned by a large managed group gets the same 35% relief and the same inflation cap as the free house down the road. In cash terms the larger property will usually save more, simply because its bill is bigger. The SBRR change is the one part of the package that only helps smaller properties.
At the very top end, properties worth £500,000 or more still pay the 52.5p high-value multiplier. UKHospitality wanted hospitality taken out of that surcharge, and it asked for the RHL discount to be raised towards 20p. The gap between the RHL and standard multipliers ended up at 5.2p.
The wider tax bill hasn’t moved
Even where rates fall, operators say the overall burden is the problem. UKHospitality’s Allen Simpson welcomed the change: for hospitality and leisure businesses in England, he said, rates will be “frozen in real terms, reduced or cut to zero for two years”. But UKHospitality also says hospitality pays 82p in business taxes for every pound it makes, and that it’s still campaigning for a VAT cut.
The BII’s sums show the squeeze. It estimates the extra pub relief is worth about £1,100 to the average pub, and that the April 2027 wage rise costs about £1,000 more for every full-time member of staff. On those numbers, a pub with even one full-time employee sees most of the rates saving go on wages.
Large operators aren’t immune either. NIQ’s tracker of managed groups has recorded sub-inflation sales growth for 16 consecutive months.
What to do now
- Check your RV. If you’re near the £18,000 or £21,000 lines, the exact figure now matters a great deal. If it looks wrong, use the VOA’s check, challenge and appeal process.
- Make sure the reliefs are applied. When your 2027/28 bill arrives, check it shows pub relief at 35% and SBRR if you qualify.
- Don’t bank the saving twice. Put any rates saving next to the April wage rise and the February duty rise before you decide what it’s paid for.
The verdict
The 2027 package doesn’t make it impossible for an independent to compete. For the smallest pubs, the higher SBRR threshold is the most useful change in years. But most of the support is shared with the big operators, and the wider tax burden that both complain about is where it was.
Sources (5)
- 8/2026: Details of the Budget package and the multipliers for 2027/2028, GOV.UK (MHCLG business rates information letter), 28 Oct 2026, updated 30 Oct 2026
- BII members disappointed as budget fails to deliver, BII, 28 Oct 2026
- #Budget26: backing hospitality to deliver growth, UKHospitality
- UKHospitality responds to the Budget, UKHospitality, 28 Oct 2026
- Nearly 19 British hospitality venues close per week, The Caterer, 30 Oct 2026