The UK leisure industry has experienced a period of significant change in recent years. From the lasting effects of the pandemic to inflationary pressures and changing consumer behaviour, operators across the sector have had to adapt rapidly. The government’s ongoing review and reform of the business rates system now represents another major factor influencing the future of leisure property and businesses.
For many leisure operators, whether running hotels, pubs, holiday parks, family entertainment centres or restaurants, business rates remain one of the largest fixed costs associated with property occupation. As reforms begin to reshape the rating landscape, the sector is watching closely to understand both the risks and the opportunities.
The Importance of Business Rates to Leisure Businesses
Business rates are a tax charged on most commercial property and are calculated using the rateable value of a property multiplied by a nationally set multiplier. For leisure operators, whose businesses are typically property-intensive and located in prominent locations, these costs can represent a significant proportion of overall operating expenses.
Unlike taxes based on profit, business rates are payable regardless of trading performance. This makes them particularly challenging for businesses whose revenues fluctuate with tourism trends, seasonal trade, and wider economic conditions.
For sectors such as hospitality and leisure, many of which require large premises to operate effectively, the structure of the rates system has long been a point of debate within the industry.
Reform of the Business Rates System
The government’s review of business rates aims to modernise the system and rebalance the tax burden across sectors. Among the proposed changes are lower multipliers for retail, hospitality and leisure properties, alongside more frequent revaluations designed to better reflect current market conditions.
However, transitional arrangements and changes to relief schemes may create short-term pressures for many operators. Some businesses that benefited from high levels of pandemic-era relief could see rates liabilities increase as those reliefs reduce.
At the same time, upcoming revaluations will reassess the rateable value of commercial properties across the UK. This means that the impact of the reforms will vary significantly depending on location, property type and trading performance.
Implications for Leisure Property Owners and Operators
For owners and occupiers of leisure property, the rates review introduces a number of important considerations:
· Changes in liability: Adjustments to reliefs and multipliers may increase or decrease overall costs depending on the property’s rateable value.
· Revaluation impacts: New rateable values could alter the tax burden on leisure premises in different locations.
· Investment decisions: Business rates are often cited as a factor that discourages investment in property improvements, as upgrades can increase rateable values.
· Appeal opportunities: Some properties may be over-assessed or incorrectly valued, particularly if market conditions have changed significantly since the last valuation.
As a result, professional advice can play a crucial role in helping businesses understand their position and manage their rates liabilities effectively.
How Vickery Holman Can Help
Vickery Holman Limited is one of the South West’s leading commercial property consultancies, providing specialist advice to property owners, investors and occupiers across the region. With offices in Truro, Plymouth, Exeter and Bristol, the firm offers a comprehensive range of property services including valuation, agency, property management, lease advisory and business rates consultancy.
The firm has extensive experience advising clients in the leisure sector, including hotels, guest houses, pubs, restaurants, holiday parks and other hospitality-related businesses. Their multidisciplinary approach allows clients to access integrated advice covering property transactions, valuation, asset management and rating matters.
Specialist Support from Jordan Kennedy and Michael Easton
Within the firm, two specialists play key roles in supporting leisure clients navigating the changing business rates landscape.
Jordan Kennedy is Associate and Head of Rating at Vickery Holman. In this role, she advises property owners and occupiers on all aspects of business rates liability, including rateable value appeals, identifying reliefs and exemptions, and challenging inaccurate assessments. Her expertise allows businesses to ensure that they are not paying more than their fair share and that opportunities for savings are fully explored.
Working alongside her is Michael Easton, who leads the firm’s hotels and hospitality agency services. With more than 20 years of commercial property experience, he specialises in advising clients involved in hotels, pubs and licensed premises across the South West. His role includes assisting with the acquisition, sale and letting of leisure properties, as well as providing strategic advice to owners and investors.
Together, their combined expertise in property transactions and business rates provides a valuable resource for leisure businesses facing the evolving rating system.
Practical Assistance for Leisure Businesses
Through their work with leisure operators and property owners, Jordan Kennedy and Michael Easton can assist with:
· Reviewing rateable values and identifying opportunities to challenge assessments
· Advising on relief schemes and exemptions available to leisure businesses
· Supporting appeals against inaccurate business rates valuations
· Providing market advice when acquiring or disposing of leisure assets
· Assisting landlords and tenants with lease negotiations and property strategy
This integrated approach enables clients to manage both the property and financial implications of the business rates system.
Looking Ahead
The ongoing review of business rates marks a pivotal moment for the leisure industry. While reforms are intended to create a fairer and more modern system, the transition period may present challenges for many operators.
For property owners, occupiers and investors within the leisure sector, understanding these changes and taking proactive steps to manage their liabilities will be essential.
With specialist expertise in both leisure property and rating consultancy, professionals such as Michael Easton and Jordan Kennedy at Vickery Holman are well placed to guide businesses through this evolving landscape and help ensure that leisure assets remain viable and competitive in the years ahead.
If you’d like to review your current liability or discuss how business rates reform may affect your leisure property, please contact our Business Rates team. Maximizing Savings with Business Rates Consultancy – Vickery Holman
