The Ministry of Housing, Communities and Local Government has published Business Rates Information Letter 5/2026 for chief finance officers in English billing authorities. Published on 26 May 2026, the letter confirms a change to the eligibility rules for 2026 Supporting Small Business Relief and states that the amendment is backdated to 1 April 2026. (gov.uk) The amendment is limited in scope but significant in operation. It deals with cases where a property becomes vacant or is reoccupied after the start of the 2026 rating list, removing a point at which relief could otherwise have been lost. (gov.uk)
Under the revised rule, a change of ratepayer or a period of vacancy after 31 March 2026 will not, on its own, end eligibility for Supporting Small Business Relief. The letter keeps one clear exception: eligibility is still lost where the property becomes occupied by a charity or a Community Amateur Sports Club. (gov.uk) MHCLG says the amendment is intended to align the scheme with the treatment of vacancy and reoccupation under Transitional Relief. In policy terms, that keeps the relief tied to the effect of revaluation on the property rather than to later changes in occupation. (gov.uk)
The wider scheme was announced at the 2025 Autumn Budget and is aimed at businesses whose bills rise at the 2026 revaluation after losing some or all of Small Business Rate Relief, Rural Rate Relief, 40% Retail, Hospitality and Leisure Relief, or 2023 Supporting Small Business Relief. Government guidance for local authorities says the 2026 scheme runs from 2026/27 to 2028/29. (gov.uk) For 2026/27, GOV.UK states that eligible bills should rise by no more than £800 or the relevant transitional cap, whichever is greater. The published caps for that year are 5% for properties up to £20,000 rateable value, 15% for properties from £20,001 to £100,000, and 30% above £100,000, with the lower band extending to £28,000 in London. (gov.uk)
The updated guidance sets out the practical effect of the vacancy change. If a property that qualified on 1 April 2026 later becomes empty, any mandatory 100% empty property relief still applies during the initial vacancy period. Once that full empty relief ends, or once the property is occupied again, 2026 Supporting Small Business Relief may apply again. (gov.uk) That removes a cliff edge for otherwise eligible hereditaments. For businesses and property owners, a temporary void or a new occupier after 31 March 2026 should no longer break continuity of support merely because occupation changed after revaluation day. (gov.uk)
For billing authorities, the administrative effect is immediate. The local authority guidance says councils deliver the relief through their discretionary powers under section 47 of the Local Government Finance Act 1988, while central government reimburses the cost that falls on authorities under the rates retention scheme. The guidance was updated on 26 May 2026 to reflect the new vacancy rule. (gov.uk) Because the amendment is backdated to 1 April 2026, that combination suggests some councils may need to revisit bills where eligibility was affected by a vacancy or a change of ratepayer after that date. The same guidance also says relief awards should be recalculated when circumstances change, including backdated changes to rateable value or to the hereditament itself. (gov.uk)
For ratepayers, the change narrows the risk of losing support purely because occupation changed after the revaluation date. It does not widen the scheme beyond its existing purpose: GOV.UK says Supporting Small Business Relief remains directed at properties whose bills increased because of revaluation and because they lost some or all of specified reliefs, with councils expected to adjust eligible bills automatically. (gov.uk) The key boundary remains unchanged. If the property becomes occupied by a charity or Community Amateur Sports Club, eligibility still ends; and, under the detailed guidance, relief also falls away once the capped bill reaches the bill that would otherwise apply. The amendment therefore preserves continuity after vacancy and reoccupation, but it does not turn the scheme into a general discount for all changes in occupation. (gov.uk)