If you own or occupy commercial property, one of the most important figures on your business rates assessment is your rateable value.
But what does rateable value actually mean, how is it calculated and how does it affect the amount you pay in business rates?
What Is Rateable Value?
The rateable value of a commercial property is an assessment of the annual rent that the property could have achieved on the open market at a specified valuation date. Rateable values for non-domestic properties in England and Wales are determined by the Valuation Office Agency (VOA).
Importantly:
Your Rateable Value is not your Business Rates Bill.
It is the starting point used to calculate your business rates liability.
Is Rateable Value the Same as Rent?
No.
Your property’s rateable value may be different from the rent you actually pay.
The VOA assesses properties according to the relevant valuation date and rating methodology, rather than simply using the current rent under your lease.
Your actual rent may have been agreed at a different time, under different market conditions or with lease terms and incentives that affect the amount paid.
How Does Rateable Value Affect Business Rates?
In simplified terms, your basic business rates liability is calculated as:
Rateable Value × Business Rates Multiplier
Any applicable reliefs, reductions or transitional arrangements are then taken into account.
This means that two properties with different rateable values can produce significantly different occupational costs, even if their quoted rents appear similar.
What Is the 2026 Rating List?
New rateable values came into effect on 1 April 2026 as part of the latest business rates revaluation.
The 2026 Rating List reflects rental values at the relevant valuation date and replaces the previous rating list.
For commercial property owners and occupiers, this means the rateable value of a property may have changed, potentially affecting the business rates payable.
Why Might My Rateable Value Have Changed?
Changes can occur for several reasons.
Property rental markets can move between revaluations, meaning different locations and types of commercial property may experience increases or decreases in assessed values.
Changes to the property itself, its use or other relevant circumstances can also affect its rating assessment.
A change in rateable value does not necessarily mean that your actual business rates bill will change by exactly the same percentage, as multipliers, reliefs and transitional arrangements can also affect the final amount payable.
Can I Check My Rateable Value?
Yes.
Commercial property owners and occupiers can check their property’s rateable value through the Valuation Office Agency.
It is worth reviewing the information held about your property, particularly following a revaluation or if there have been changes to the premises.
What If I Think My Rateable Value Is Wrong?
If you believe the information held about your property or its rateable value is incorrect, it may be possible to request a change or challenge the assessment.
However, a challenge should not automatically be made simply because a rateable value has increased.
Obtaining specialist advice can help establish how the property has been assessed and whether there may be reasonable grounds for further action.
Why Rateable Value Matters When Choosing Commercial Property
Rateable value is particularly important when comparing potential commercial premises.
A property with an attractive headline rent may not necessarily provide the lowest overall occupational cost once business rates and other expenses are considered.
Businesses searching for new premises should therefore investigate:
Rent + Business Rates + Service Charge + Utilities + Fit-Out + Other Occupational Costs
before making a final property decision.
Need Help Understanding Your Business Rates?
TGE Property helps businesses, landlords and investors understand commercial property costs as part of their wider property strategy.
Where specialist rating advice is required, we can connect clients with experienced business rates advisers who can review the property’s assessment and advise on the appropriate next steps.
Contact TGE Property to discuss your commercial property and business rates requirements.