Business Rates 2026: What the April Revaluation Means for Your Premises Costs

The 2026 business rates revaluation took effect in April 2026, based on rental values at the antecedent valuation date (AVD) of 1 April 2025. For many occupiers, it is the most significant change to premises costs in several years — particularly for warehousing, logistics, and small retail and leisure businesses.

This article explains what changed, who is most affected, and what steps businesses should take to make sure they are not overpaying.

What Is Business Rates Revaluation?

Business rates are a tax on the occupation of commercial property, calculated by multiplying the rateable value (RV) of a property by the national multiplier. Rateable values are set by the Valuation Office Agency (VOA) and represent the estimated annual rent a property could command at the AVD.

Revaluations reset rateable values across the commercial property stock. The intention is to ensure business rates reflect current rental markets — though the three-year gap between the AVD and the implementation date means the values are already partially historical.

The 2026 revaluation used rental evidence from April 2025 — a market in which logistics and distribution rents had risen sharply, and in which retail and leisure in many secondary towns had continued to struggle.

The Warehouse Surcharge

One of the most significant changes in the 2026 revaluation is the introduction of a higher multiplier for large distribution and logistics properties. Properties with a rateable value exceeding £500,000 — which in practice means most large logistics facilities and distribution centres — are subject to a surcharge on the standard multiplier.

The surcharge was introduced to capture a portion of the substantial rental growth in the logistics sector over 2021–2025. For occupiers of large warehouses, the effective business rates liability in 2026–27 may be materially higher than in 2025–26, even before any revaluation change to the underlying rateable value.

Businesses occupying large logistics facilities should model their full business rates liability under the new multiplier and consider whether their existing rateable value accurately reflects market rent at the AVD — particularly if they entered their lease at a below-market rent for any reason.

Small Business Retail and Leisure Relief

At the other end of the scale, the government has continued and extended transitional relief for small retail and leisure properties. Premises with a rateable value below £51,000 in retail, hospitality, or leisure use benefit from a 40% discount on their business rates liability in 2026–27.

This relief is significant for small businesses in town centres, high streets, and leisure destinations that would otherwise face substantially higher liabilities following revaluation. The relief is applied automatically through your local authority — you do not need to apply — but it is worth checking your rates bill to confirm it has been applied correctly.

The relief is not available for:

• Properties above the £51,000 RV threshold
• Office or industrial uses, even at low rateable values
• Properties not in rateable use (vacant properties are assessed separately)

The Transition From the 2023 Valuation

The 2026 revaluation follows the 2023 revaluation. Where the 2026 RV is significantly higher or lower than the 2023 RV, transitional relief caps the annual change in liability for some properties. Transitional relief calculations are complex and vary by property type and size — if your bill has changed substantially, your local authority or a specialist rating surveyor can advise on whether transitional provisions apply.

Modelling Total Occupancy Cost

For any business considering a new commercial lease, business rates should be modelled as part of total occupancy cost alongside rent, service charge, and utilities. An attractive headline rent can be undermined by a high rateable value — and vice versa.

Some practical points:

Check the rateable value before you agree heads of terms. The VOA publishes rateable values at voa.gov.uk. For any property you are considering, look up the current RV and calculate the estimated rates liability using the published multiplier. This should be part of your due diligence, not an afterthought.

Understand the valuation basis. Rateable values are based on open market rent at the AVD. If you are paying a rent materially different from the assessed rateable value, it is worth understanding why — and whether the RV accurately reflects the property's condition and specification at the AVD.

Empty property rates. If a property has been empty, the landlord will typically have been paying empty property rates (after a three-month exemption period). For occupiers taking on a property that has been vacant, the landlord's motivation to let — and willingness to offer incentives — may partly reflect the cash cost of holding a void.

The Check, Challenge, Appeal (CCA) Process

If you believe your property's rateable value is too high, you have the right to challenge it through the VOA's Check, Challenge, Appeal (CCA) process:

Check. The first stage is to review the information the VOA holds about your property — floor area, use, condition. You can do this online at the VOA website. If the factual information is wrong, a correction can result in a revised RV without a formal challenge.

Challenge. If you believe the RV is wrong even with correct facts, you can submit a formal challenge proposing an alternative value. The challenge must include evidence — comparable rental transactions at the AVD, analysis of market conditions, or physical factors affecting value.

Appeal. If the challenge is not resolved at the VOA stage, you can appeal to the independent Valuation Tribunal for England (VTE). Appeals are heard by a panel and can result in a revised RV, confirmation of the existing RV, or occasionally an increase.

The CCA process can take months or longer. Repayment of overpaid rates is not automatic — it follows from a revised assessment. Getting specialist advice from a chartered surveyor with a rating qualification is often worthwhile for larger liabilities.

How RE:match Can Help With Occupancy Cost Planning

Business rates are one reason why choosing the right premises matters beyond just rent. The total occupancy cost of a commercial property — rent plus rates plus service charge plus utilities — varies significantly between otherwise similar units, and the rateable value is not always predictable from the rent.

RE:match connects businesses with landlords and agents who understand their local market and can advise on total occupancy cost as part of a letting. You post your requirement — what you need, where, and when — and the market responds directly.

Post your requirement on RE:match — it takes a few minutes and costs nothing. Landlords and agents with matching space respond directly to your brief at rematch.co.uk.

FAQ: Business Rates 2026 Revaluation

What is the antecedent valuation date (AVD) for the 2026 revaluation? The AVD is 1 April 2025. This means rateable values in the 2026 revaluation are based on estimated rental values at that date, not at the time the revaluation took effect (April 2026).

Does the warehouse surcharge apply to all industrial properties? No. The surcharge applies to properties with a rateable value exceeding £500,000 — this primarily captures large distribution centres and major logistics facilities. Most small and medium industrial units are below this threshold.

What is the small retail and leisure relief for 2026–27? Retail, hospitality, and leisure properties with a rateable value below £51,000 receive a 40% discount on their business rates liability in 2026–27. The relief is applied automatically; no application is required.

How do I check my property's rateable value? You can look up any commercial property's rateable value at the Valuation Office Agency website (voa.gov.uk). Search by address or postcode to find the current and historical assessments.

What is the CCA process and should I use it? The Check, Challenge, Appeal process is the formal route to dispute your rateable value. Check your property's data first; if there are factual errors, a correction may reduce the RV without a formal challenge. For larger liabilities, consulting a RICS-qualified rating surveyor before submitting a challenge is advisable — the process has strict timescales and evidentiary requirements.