What are non-domestic rates?
Non-domestic rates, commonly known as business rates, are a tax levied on properties. Most non-domestic properties need to pay business rates, in a similar way to households paying council tax. The revenue raised is used as part of the funding for local services and is collected by Scottish councils.
Business rates are calculated by multiplying the rateable value of your non-domestic property (which is roughly based on your premises’ notional annual rent) by the poundage rate (or multiplier) set annually by the Scottish Government.
You can use the Scottish Government’s calculator to estimate your business rates bill here.
The 2026-27 non-domestic rate poundage rate (Basic Property Rate) is set at 48.1p. There are additional supplements applying to business premises with rateable values over £51,000 and £100,000 giving an Intermediate Property Rate of 53.5p and Higher Property Rate of 54.8p respectively.
Usually, the poundage increases each year by the rate of inflation to ensure that the same amount of money (in real terms) is collected each year. The Scottish Government confirmed the rate would be reduced in 2026-27 to reflect overall growth in rateable values as a result of the most recent rates revaluation.
You can check your current rateable value on the Scottish Assessors’ Association website.
Non-domestic rates relief
Many properties receive 100% or partial rates relief as a tax discount, or through the Small Business Bonus Scheme (SBBS). Other potential reasons for relief include if your property is in a rural area, is used for charitable or religious purposes, or it has been empty recently.
More information about non-domestic rates reliefs is available here
In its Budget for 2026-27, the Scottish Government set out its intention to continue the SBBS for the next three years, maintained at the existing rates and thresholds of the revaluation cycle.
The government also set out that shootings and deer forests will be excluded from eligibility for SBBS relief from 01 April 2026. In addition, those premises requiring a short-term let licence to operate will only be eligible for SBBS relief if they have a short-term let licence.
All the property categories which are ineligible for Small Business Bonus Scheme relief will also be ineligible for Fresh Start relief from 01 April 2026. The Scottish Government’s 2026-27 Budget confirmed 100% relief for eligible Electric Vehicle-charging points for 10 years from 1 April 2026.
Relief available for ratepayers with one business property
Rateable Value Relief
Up to £12,000
100% (no rates payable)
From £12,001 to £15,000 Scales from 100% to 25%
From £15,001 to £20,000 Scales from 25% to 0%
Relief available for ratepayers with more than one property
Rateable Value Relief
Up to £12,000
From £12,001 to £15,000
100% (no rates payable)
25% on each individual property with a rateable value of £15,000 or less
From £15,001 to £20,000 Scales from 25% to 0% for individual properties with rateable values from £15,001 to £20,000
Source: www.mygov.scot/non-domestic-rates-relief/small-business
2026 Revaluation
2026 Revaluation
2026 will also see a revaluation of business rates. These usually occur every three years when Scotland’s assessors conduct a revaluation exercise to determine the rateable value of all public and private non-domestic properties.
According to the 2026 Draft Revaluation Roll, there is an increase in rateable values for 144,000 properties, with an average increase of £7,300, and a decrease for 40,000 properties, by an average of £3,500.
A Revaluation Transitional Relief will be introduced to cap increases in rates liabilities due to revaluation, which will cap increases in gross bills up to the next revaluation in 2029. Increases in non-domestic rates gross liabilities due to revaluation will be capped at 15% (cash terms) in 2026-27 for small properties, rising in subsequent years.
Year-on-year Transitional Relief caps (%), 2026-27 to 2028-29
Source: Scottish Government draft Budget 2026-27
In addition, the Scottish Government’s Budget for 2026-27 committed to the introduction of Small Business Transitional Relief to ensure that those ratepayers losing, on 01 April 2026, eligibility for Small Business Bonus Scheme relief (including shootings and deer forests, but excluding those properties that require a short-term let licence but do not have one), rural relief, hospitality relief or Small Business Transitional Relief introduced for the 2023 revaluation cycle, do so in a phased manner.
Under Small Business Transitional Relief, eligible ratepayers will pay 25% of any increase to their net bill in the first year (2026-27), 50% in the second year (2027-28) and 75% in the third year (2028-29).
For businesses operating in the retail, hospitality and leisure sectors, the Budget for 2026-27 confirmed 15% nondomestic rates relief for the next three years for retail, hospitality and leisure premises liable for the Basic or Intermediate Property Rates (with a rateable value up to and including £100,000), capped at £110,000 per business per year.
100% rates relief will be extended to retail, hospitality and leisure premises located on islands (as defined by the Islands (Scotland) Act 2018), as well as specified remote areas (Cape Wrath, Knoydart and Scoraig), capped at £110,000 per business per year.
Following Budget negotiations, the Scottish Government confirmed an additional 25% relief for eligible licensed hospitality and music venues, liable for the Basic or Intermediate Property Rate, for three years from 2026-27. This takes the total relief for eligible licensed hospitality premises and music venues to 40% for the next three years, capped at £110,000 per business per year.
At the same time, Revaluation Transitional Relief for the self-catering sector was confirmed, which will cap increases in gross bills for those seeing the biggest increases in rateable values at revaluation, up to the next revaluation in 2029 at 15% year-on-year. This is instead of the Revaluation Transitional Relief announced at the Budget which will apply to all other properties seeing the biggest increase at revaluation. For self-catering properties seeing the biggest increase, the cumulative cap for increases in gross rates liabilities relative to 2025-26 will therefore be 15% in 2026-27, 32.3% in 2027-28 and 52.1% in 2028-29.
The Scottish Government has provided some illustrative worked examples of the application of various reliefs for 2026-27 which you can view here. Please note these are for illustrative purposes only and it will be for councils to interpret and apply the legislation based on the information they have.
How will you be affected by the revaluation?
Rateable values have now been published on the Scottish Assessors’ Association website and you should have received notification of your draft value in late 2025 by letter, with the final confirmation coming before 1 April 2026
What matters during a revaluation is whether your rateable value (the notional rent at a fixed point in time) has gone up or down relative to the national average. Broadly, businesses in areas or industries doing well should expect their rateable values to increase, and firms in depressed areas should expect them to decrease. However, even small changes to your rateable value could make you eligible for - or disqualify you from - rates relief.
What to do if you think you’ve been valued incorrectly?
If you believe that your value is incorrect, you may have grounds to appeal. The Scottish Government has guidance on getting professional advice here
The deadline for challenging a draft revaluation has now passed. However, once your valuation has been finalised, you will then have the opportunity to formally appeal it from 1 April 2026.
The last date for appealing against your revaluation is within six months of the date of issue of the assessor’s Valuation Notice (this provides the new rateable value).
You can also employ a professional property agent to act on your behalf when making an appeal but be careful. The sector is largely unregulated, and standards vary significantly. The Royal Institution of Chartered Surveyors (RICS) has issued a code of practice for rating professionals. FSB members should consider using this as the basis for a contract with any professional adviser.
Further help
Councils are able to grant discretionary relief to businesses in their local area, though often only in exceptional circumstances. Councils may also allow firms to defer payment in special circumstances.
You can contact your local assessor if you:
• don’t understand how your rateable value was calculated and want more detail
• think your valuation details are wrong
• disagree with the assessor’s valuation
And you should always contact your local assessor if:
• you move or make changes to your premises
• the nature of your business changes
You can also update your information on the Scottish Assessors Association website.