The government has confirmed which businesses will qualify for the new lower business rates multipliers for retail, hospitality and leisure properties, ahead of the next revaluation in April 2026.

The reforms, first announced in the Autumn Budget 2024, introduce two new reduced business rates multipliers for RHL properties in England with rateable values below £500,000: a Small Business RHL Multiplier for properties with a rateable value under £51,000; and a Standard RHL Multiplier for those between £51,000 and £499,999.

The change marks the first permanent structural reduction in business rates for shops, restaurants, pubs, hotels and other qualifying venues. It replaces the temporary discretionary reliefs that have been renewed annually since 2020.

Unlike the previous relief system, the new regime will not be subject to a cash cap, ensuring that all eligible premises within a retail, hospitality or leisure chain will benefit. Eligibility will be determined under new statutory definitions rather than at the discretion of local authorities.

The details are set out in The Non-Domestic Rating (Definition of Qualifying Retail, Hospitality or Leisure Hereditament) Regulations 2025 (SI 2025/1093), which have now been laid before Parliament. The criteria broadly mirror the existing 40% RHL relief scheme but place it on a statutory footing.

Only occupied premises “wholly or mainly” used for in-person retail, hospitality or leisure activity for visiting members of the public will qualify.
Qualifying property types include:

Retail: shops, supermarkets, florists, opticians, newsagents, petrol stations, jewellers, chemists, garden centres, tattooists and beauty salons.
Hospitality: cafés, takeaways, restaurants, pubs, bars, nightclubs, hotels and guest houses.
Leisure: cinemas, theatres, galleries, museums, gyms, sports clubs, bowling alleys, soft play centres and theme parks.

Excluded categories include financial, medical and professional services, taxi and minicab firms, betting shops, conference centres and transport hubs.
The precise rates for the new multipliers will be confirmed at the Autumn Budget on 26 November 2025, once the 2026 Revaluation and wider fiscal conditions have been finalised.

From April 2026, a new surtax of up to 10p in the pound will apply to properties with an RV above £500,000 as part of the new five-tier multiplier system. These policies apply to England only, as business rates are a devolved tax.

Alex Probyn, practice leader, Europe & Asia-Pacific property tax, at global tax firm Ryan, said: “With the cash cap of £110,000 in relief removed, this is a major boost for multi-site operators. But many will now be anxiously waiting to see whether their larger stores and venues over £500,000 in rateable value, which are excluded from the lower tax rates, will attract the new supplement to standard rates. Across the retail, hospitality and leisure sectors, up to 4,353 premises could be caught by the supplement – facing an estimated £482m a year extra in business rates.

While gains from lower bills from the new lower RHL multipliers also risk being clawed back in part through higher bills on warehouses, distribution centres and corporate HQs – many of which are expected to face not only the supplement but sharp increases under the revaluation, creating a potential double hit. For single-site and independent operators, the reduction in the multiplier will be broadly in line with existing discounts – offering stability rather than a step-change, but still far below the 75% relief in the previous financial year.”