Business Rates Reform: What It Means for Leisure Businesses in the South-West from 2026
The Autumn Budget 2024 and subsequent legislation set a new course for business rates from April 2026, especially for the leisure sector. Pubs, restaurants, hotels, holiday parks, visitor attractions, gyms, cinemas and theatres across the South West should see more predictable, long term support if their rateable value (RV) is below £500,000. Below is a clear summary of what’s changing, what’s still to come, and the practical steps leisure operators can take now.
Permanent support from 2026
From April 2026, the government intends to replace the annual Retail, Hospitality and Leisure (RHL) relief with two new, permanently lower multipliers for RHL properties with RVs below £500,000. This moves away from year to year cliff edges and towards longer-term certainty for high street and destination leisure operators.
To fund this sustainably, a new higher multiplier is intended for properties with RVs of £500,000 and above. Fewer than 1% of properties fall into this bracket – primarily large distribution warehouses used by online retailers – but some larger leisure assets could also be affected if their RVs exceed £500,000.
How the multiplier structure will change
From April 2026 onward, the system is expected to operate as below (final rates will be set at Budget 2025):
- RV below £51,000:
- Small business RHL multiplier (RHL properties only)
- Small business multiplier (non RHL properties)
- RV £51,000 to £499,999:
- Standard RHL multiplier (RHL properties only)
- Standard multiplier (non RHL properties)
- RV £500,000 and above:
- High value multiplier (all properties)
The exact levels of the new multipliers will be announced at Budget 2025 and will reflect the 2026 revaluation and wider economic and fiscal context.
Guardrails in law: Non Domestic Rating (Multipliers and Private Schools) Act 2025
The Non Domestic Rating (Multipliers and Private Schools) Act 2025, which received Royal Assent on 3 April, sets important guardrails:
- The high value multiplier cannot be more than 10p higher than the standard multiplier.
- The standard RHL multiplier and the small business RHL multiplier cannot be more than 20p lower than the small business multiplier (i.e., a maximum 20p discount below the small business multiplier).
These limits are not targets; they provide flexibility around the 2026 revaluation while reassuring stakeholders that there are legislative bounds on the new rates. Eligibility for the RHL multipliers will be set in secondary legislation, intended to broadly mirror the current RHL relief scope.
2026 Revaluation: what leisure operators need to know
A routine national revaluation will take effect on 1 April 2026, based on values at 1 April 2024. Revaluations are intended to redistribute liabilities to reflect market evidence. At Budget 2025, the government will announce the 2026/27 multipliers, alongside details of any Transitional Relief.
For many leisure properties, the calculation of rateable value relies on trading performance (receipts and expenditure) or a hybrid of trading and rental evidence. That makes robust, well presented trading data critical. For operators in the South West – particularly seasonal coastal businesses, holiday parks and destination hospitality – ensuring the VOA has accurate, figures will be essential to generate a fair RV reflective of business performance.
What this means for leisure businesses in the South West
For most leisure occupiers and owners with RVs below £500,000, the new RHL multipliers should provide ongoing relief and stability. Those with RVs close to £500,000 should keep a close eye on the revaluation, as those that exceed this from April 2026 will be exposed to the higher multiplier.
How we can help
Our Business Rates team specialises in leisure across the South West; we can check the accuracy of your current 2023 rateable value, your draft 2026 rateable value and your published 2026 rateable value when confirmed. We have a proven track record of successfully reducing rateable values for a wide-range of operators and we are always happy to have an initial conversation to discuss your concerns or needs. Please get in touch at [email protected]
