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Business Rates: Improvement Relief

Calculation of the chargeable amount

Improvement relief is not calculated and applied in the same way as other reliefs. It operates as a deduction (the amount of "G") to the rateable value used to calculate the chargeable amount, rather than a deduction from a partially calculated liability. This ensures that any interactions with eligibility for other reliefs which may result from a rateable value change do not penalise the ratepayer. 

When qualifying improvement works are assessed by the VOA, the rating list will be updated to reflect the new rateable value for the hereditament and the certificate will identify the amount of that rateable value that it attributed to the works. For the 12-month duration of the certificate, billing authorities will calculate the chargeable amount of NDR for the relevant property as if the rateable value in the list for the day concerned is that rateable value minus "G" (the value of the certificate). This means that improvement relief is applied before the multiplier and any other reliefs in the calculation of the chargeable amount.

The approach is more nuanced than requiring billing authorities to reduce the chargeable amount. It is intended to be simpler and ensure that ratepayers can be confident that undertaking qualifying works will not result in their effective rateable value increasing for 12 months. 

The legislation providing for transitional relief following the 2023 NDR revaluation (the Non-Domestic Rating (Chargeable Amounts) (Wales) Regulations 2022) has been amended as a consequence of the introduction of improvement relief, to ensure that the same principle applies where liability is calculated in accordance with the transitional relief rules. Where improvement relief applies, the rateable value used to calculate transitional relief entitlement will also be the value shown in the list for the day concerned minus "G".