What are Business Rates and Council Tax and how is that money spent?

  • What are Business Rates and Council Tax and how is that money spent? 1

Business rates are the rates paid by businesses to central government via their local councils. They are like a tax, but they don't go towards local services, except as part of the government’s handout to local authorities. They are assessed on the area of space occupied by business. Council tax is collected by local councils and goes towards the following local services:

  • Planning and economic development
  • Recreation and tourism
  • Environmental health
  • Refuse Collection
  • Education
  • Social Services
  • Police
  • Fire

Council Tax (residential) assessed on the market value of domestic properties as at 1 April 1991. Properties are then graded by bands A to H. There is 25% discount where only one person lives in a property.  There can be 100% Council tax surcharge if a property has been empty for more than 1 year. Some councils charge extra council tax for second homes.

Business rates             Council Tax             Domestic properties               Tax