As we navigate through 2025, business leaders across the UK are facing mounting pressures from every direction. Supply chain disruptions, labour shortages, and economic uncertainty dominate boardroom discussions. Yet there’s one significant cost that many businesses are overlooking – a cost that typically represents their third highest expense after rent and wages.
Business rates.
The Scale of the Challenge
For most businesses, business rates represent a substantial financial burden that demands immediate attention. Unlike rent, which you negotiate, or wages, which you control, business rates often feel like an unavoidable cost that simply appears on your bill each quarter. This perception is not only wrong but also it costs businesses millions in unnecessary payments.
The reality is that business rates are far more manageable than most business owners realise. Yet the complexity of the system, combined with the technical nature of rating legislation, means that countless opportunities for savings go unnoticed every year.
Why 2025 is Critical
We’re currently operating under the 2023 rating list, which will remain in effect until April 2026. This timing creates a perfect storm of opportunity and urgency that every business owner needs to understand.
The post-COVID recovery has driven significant changes across most sectors. Properties that were previously discounted by 15-30% due to pandemic impacts are now returning to and in many cases exceeding their 2019 trading levels. The recovery is excellent news for business performance, but it signals substantial rate increases ahead in the 2025 revaluation.
Meanwhile, the current Labour government has implemented sweeping changes to the business rate system. Retail, hospitality and leisure relief has been slashed from 75% to 40% overnight. By April 2026, this relief will disappear entirely. The government has also introduced five new multiplier categories, replacing the current two-tier system, and removed charitable relief for private schools.
These changes aren’t just policy adjustments; they represent a fundamental shift in how business rates will be calculated and applied across the UK.
The Hidden Opportunities
Here’s what many business owners don’t know: you can challenge your business rates assessments. In fact, there are two distinct opportunities that could deliver significant savings.
Rating Appeals: Challenge your rateable value based on the property’s characteristics, location and market conditions. This can apply to historic, current and future assessments.
Rating Audits: Review the calculations and reliefs applied by local authorities. These audits frequently uncover errors in calculations, missed reliefs or incorrect applications of exemptions.
The window for challenging your current rates closes on 31st March 2026. Miss this deadline, and you’re potentially losing three years of overpayment, money that could be reinvested in your business growth.
The Complexity Factor
The business rates system is undeniably complex. There’s extensive law, regulations, exemptions and reliefs to navigate. The new five-multiplier system will not only add to this complexity when businesses need clarity most.
This complexity isn’t accidental; it’s a feature of a system that has evolved over decades. But complexity creates opportunity for those who understand how to navigate it effectively.
Technology is advancing rapidly, with AI potential moving us towards what experts call ‘a more perfect knowledge system.” However, until these technological solutions are fully implemented, businesses need practical, expert guidance to manage their current obligations.
Taking Action in 2025
The question isn’t whether you can afford to investigate your business rates, it’s whether you can afford not to. With rates typically representing your third highest expense, even modest reductions can deliver substantial savings.
The key is acting now. The 2026 rating list begins in April, using April 2024 as a valuation date. General increases are expected across most sectors, making current opportunities even more valuable.
Don’t let complexity deter you from exploring these opportunities. The most important opportunity, our experts often say, is the opportunity to challenge your rates.
At Dunlop Heywood, we specialise in turning business rates complexity into opportunity for our clients across all sectors. Our team of experts manage day-to-day operations while identifying savings opportunities that many businesses miss.