Government guidance now out for Local Authorities on RHL business rates’ relief scheme

The Government has released guidance to billing authorities in administering the 2025/26 Retail, Hospitality and Leisure Business Rates Relief Scheme.

Announced at the Autumn Budget last year, Rachel Reeves rolled out an extension of the business rates relief scheme for retail, hospitality, and leisure (RHL) properties.

Reportedly worth over £1.5 billion in 2025/26, it provides businesses with the necessary interim support until the introduction of the permanently lower tax rates for RHL properties, including those on the high street, from 2026-27.

The 2025/26 RHL Business Rates Relief scheme will provide eligible occupied retail, hospitality, and leisure properties with a 40% relief, up to a cash cap limit of £110,000 per business. The government is expecting local authorities to provide details to eligible ratepayers for 2025/26 in their bills for the beginning of the 2025/26 billing cycle.

The guidance applies to England only and, as a temporary measure for 2025/26, this doesn’t replace existing legislation. Instead, the Government, in line with the eligibility criteria set out in the guidance, will reimburse local authorities that use their discretionary relief powers under section 47 of the Local Government Finance Act 1988 (as amended) to grant relief. It will be for individual local billing authorities to adopt a local scheme and determine in each individual case when, having regard to this guidance, to grant relief.

The full guidance can be viewed here: Business Rates Relief: 2025/26 Retail, Hospitality and Leisure Scheme – GOV.UK