Half of England’s small businesses are failing to take advantage of a system that would cut their rate bills, leaving unclaimed around four hundred million pounds of money that local government leaders say could make the difference between staying afloat and going bankrupt.The Local Government Association has conducted a survey of local authorities which reveals wide regional variations but shows that overall only 48 per cent of eligible small firms have applied for Small Business Rate Relief that could see them getting reductions of up to up to 2,500 pounds on their bills. The relief system came into effect last year and entitles eligible businesses with rateable values of below 5,000 pounds to 50 per cent relief on their liability. The relief decreases on a sliding scale.
The LGA study shows that in the North West only just over a quarter of eligible businesses have taken up the relief compared to 79 per cent of businesses in the North East of England. In only one other region, the East, have more than half of businesses taken advantage of the support. The figure there is 57 per cent. In both the Midlands and the South West the figure is 48 per cent, 43 per cent of businesses in the South East have taken up relief and in London the figure is just 34 per cent.
Council leaders have issued an urgent plea to businesses to come forward and claim the money to which they are entitled, especially as the LGA points to recent figures that show were 3,439 company liquidations in the first quarter of this year in England and Wales, a rise of more than 17 per cent on the previous year’s level.
The Chairman of the Local Government Association, Sir Sandy Bruce-Lockhart, said small businesses were facing immense difficulties keeping their heads above water but hundreds of millions of pounds was waiting to be claimed by small firms.
“When local businesses are facing rising costs, it is vital that they apply for the tax relief that they are entitled to. Many thousands of businesses are entitled to a tax rebate that could make the difference between business as usual and bust,” he said.