Business rates freeze and relief changes

What retail and hospitality businesses should do now

In the 2026 Autumn Budget, Chancellor John Healey announced a two-year bill freeze for retail, hospitality and leisure (RHL) businesses in England from April 2027. Eligible bills will be capped at CPI increases in 2027/28 and 2028/29, with no rateable value limit. This freeze will soften the impact of the 2026 revaluation of business rates bills, but it won’t help every business.

In this article, our retail and hospitality specialists explain what has changed, who benefits, and what to do before the 2027/28 rates year starts.

What the Budget changed for 2027/28

These changes are built on the 2026 revaluation. From 1 April 2026, every property’s rateable value was reset to reflect its 2024 rental value, and the government introduced five multipliers, with lower rates for qualifying RHL properties. The Budget has since added a two-year cap on rates increases for qualifying businesses, higher relief thresholds and new multipliers for 2027/28.

Our rolling Till to table update covers the headline Budget measures, including the new relief thresholds and the pubs relief. This article covers something different: how the rates rules work in practice, and what businesses should do about them.

Business rates multipliers for 2027/28

The RHL multipliers will sit 5.2p below the standard and small business multipliers in 2027/28. All five multipliers rise on 2026/27. For eligible RHL properties, the CPI cap limits how much the bill can increase, whatever the multiplier.

Multiplier	Rateable value	2026/27	2027/28	Change
Small business RHL	Below £51,000	38.2p	39.5p	+1.3p
Standard RHL	£51,000 to £499,999	43.0p	44.5p	+1.5p
Small business (non-RHL)	Below £51,000	43.2p	44.7p	+1.5p
Standard (non-RHL)	£51,000 to £499,999	48.0p	49.7p	+1.7p
High-value (all sectors)	£500,000 and above	50.8p	52.5p	+1.7p

The rateable value bands shown are those that applied in 2026/27. The MHCLG letter does not restate them for 2027/28.

Which businesses benefit from the rates changes?

The freeze is the most valuable change for larger operators, because it has no rateable value limit, so multi-site retailers and hospitality groups that qualify will get the same CPI cap as a single-site business. Smaller operators will benefit through the higher Small Business Rates Relief (SBRR) thresholds for RHL properties. These give full relief up to £18,000 of rateable value (from £12,000), tapering to nil at £21,000 (from £15,000). Meanwhile, pubs and live music venues will gain through the larger relief. There are four points, however, which can catch businesses out:

The test is applied on 1 April each year: Unoccupied properties cannot qualify as RHL hereditaments, so a site that is vacant on 1 April gets no freeze for that year. Operators opening or reopening sites should plan the timing carefully.
The cap only covers the bill as it stands: Increases from improvements, and the loss of other reliefs such as improvement or hardship relief after 1 April 2026, sit outside it.
Some sectors are carved out: Vape shops lose the RHL multipliers and SBRR. Adult gaming centres lose the RHL multipliers but stay eligible for SBRR, on the existing £12,000 and £15,000 thresholds.
Multi-site operators face a single threshold: SBRR for second and further properties will use one £29,999 aggregate threshold in England until 31 March 2029. It replaces £27,999 in London and £19,999 elsewhere, so check whether your group still qualifies.

What should retail and hospitality businesses do next?

Now: Get the bill right

Sense-check your new rateable value: Compare the rateable value on your bill with the rating list and with similar properties nearby. Check the floor area, the use class and whether every part of the property should be included. Confirm that each site is correctly treated as RHL, and that the cap and any reliefs appear on the bill. Administrative errors happen, so bring in an adviser early if anything looks wrong, before the error feeds into forecasts and board reporting.

Check occupancy dates too. Any site that is vacant on 1 April 2027 will miss the freeze for that year.

Next 1-3 months: Protect cash and margins

Rework the P&L with the new costs: The CPI cap gives you a clearer view of rates for the next two years, so model it at site and group level. Assess rates as a percentage of turnover for each location and identify sites where the ratio exceeds your threshold. Responses may include moderating recruitment, adjusting rotas, reducing trading hours on less profitable days and, for sites that underperform despite these steps, planning managed closures or exits.
Pause or re-prioritise capital projects: Re-rank capex using returns that reflect the new cost base. Some refurbishments, new formats or technology roll-outs may need to move from approved to on hold unless trading stays on plan. Be explicit about which projects only proceed if revenue or cash thresholds are met, and which are so critical to brand or compliance that they must go ahead. Remember that improvements can increase a rateable value, and the cap does not cover that increase.
Where you have capacity, invest in efficiency: Better workforce management, back-office automation and self-service or digital ordering can all help where they fit the brand. Each investment should have a clear payback period and a measurable effect on labour or overhead costs.

Next 1-3 years: Reshape the model

Plan for the end of the freeze: The cap runs until 31 March 2029, and the 2029 revaluation will review the SBRR thresholds. Build scenarios that show your rates bill once the protection ends, and set thresholds in advance for reviewing sites that become consistently loss-making or put covenant compliance at risk.
Protect the long-term brand while stress-testing: Cutting costs is often the first response, but identify your non-negotiables first. Core locations, service standards and product quality should change only as a last resort. Some retailers have deliberately held on to flagship sites through previous downturns because those sites define how customers see the brand. Separate brand-defining assets from nice-to-have spend, and take a surgical approach.
Consider diversification if you can fund it: Pressure on physical sites can prompt a rebalancing of channels. That might mean slightly fewer but better-performing locations, supported by digital, click-and-collect and delivery. Some operators may add hospitality offerings within retail settings, and hotels may introduce event packages. All of this needs capital, so it is only realistic where the balance sheet allows.

The bottom line

The Budget gives many retail and hospitality operators two years of capped rates increases, but it is not a blanket reprieve. Businesses that check their bill now, confirm which reliefs apply and model the position beyond March 2029 can make measured decisions that protect cash in the short term while keeping brand and customer experience intact.

How can Price Bailey help?

Our dedicated Retail & Hospitality team can support you with:

Checking your bill and rateable value, so you work from the right starting point.
Confirming whether your business qualifies for the freeze, SBRR, pubs relief and other reliefs.
Site-by-site and group-level impact modelling.
Profitability reviews and options appraisals across locations.
Capex reprioritisation using updated returns and clear decision thresholds.
Board and lender-ready outputs that turn the analysis into decisions and actions.

If you would like to discuss the implications for your business, get in touch with our team today for a no-obligation conversation.

Get in touch

References

Ministry of Housing, Communities and Local Government (MHCLG), Business rates information letter 8/2026: details of the Budget package and the multipliers for 2027/28, GOV.UK, 28 October 2026
https://www.gov.uk/government/publications/82026-details-of-the-budget-package-and-the-multipliers-for-20272028/82026-details-of-the-budget-package-and-the-multipliers-for-20272028

London Borough of Sutton, Business rates changes from 1 April 2026
https://www.sutton.gov.uk/-/business-rates-changes-from-1-april-2026

Cornwall Council, Business rates changes and 2026 revaluation
https://www.cornwall.gov.uk/business-trading-and-licences/business-rates/business-rates-changes-and-2026-revaluation/

We always recommend that you seek advice from a suitably qualified adviser before taking any action. The information on this page is intended as a general guide only. While we work to keep our content accurate and up to date, we cannot guarantee that it reflects the position at the time you are reading it. No responsibility for loss occasioned by any person acting or refraining from action as a result of this material can be accepted by the authors or the firm. For more information on our editorial process, click here.

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