Did you know that thousands of small businesses in Scotland pay more in property taxes than they need to? With the right knowledge and timely application, many entrepreneurs can access significant savings through Small Business Rates Relief Scotland.
From independent retailers and rural shopkeepers to nurseries and startups, the Scottish Government offers various schemes to help reduce the burden of non-domestic rates, often by up to 100%. Yet, many eligible business owners either don’t apply or are unaware they qualify.
This comprehensive guide explores everything you need to know about small business rates relief in Scotland in 2025: what’s available, who qualifies, how to apply, and how much you could save.
What Is Small Business Rates Relief in Scotland?
Business rates officially known as non-domestic rates are a property tax paid by businesses that occupy commercial premises such as offices, shops, warehouses, and cafes. These charges are calculated based on a property’s rateable value, which is determined by the Scottish Assessors Association.
In Scotland, the Small Business Rates Relief initiative is a government-backed scheme that reduces or removes business rates liability for qualifying small enterprises. This relief aims to ease financial pressure on local businesses and support entrepreneurial activity across the country.
Administered by local councils and funded by the Scottish Government, the relief is available through several programmes, with the most well-known being the Small Business Bonus Scheme.
Why Does Small Business Rates Relief Matter for Entrepreneurs and SMEs?
Business rates can represent a major ongoing cost for small businesses, particularly those just starting out or operating with limited cash flow.
For these enterprises, rates relief schemes offer a way to reduce overheads, preserve working capital, and reallocate funds towards growth, staffing, or product development.
- Businesses with a rateable value under £12,000 can receive 100% relief, meaning no business rates are due.
- Those between £12,001 and £15,000 get a sliding scale relief, potentially saving thousands each year.
In challenging economic times, especially post-pandemic and amid inflation, these savings can be vital for survival and expansion.
What Schemes Are Available for Small Business Rates Relief in Scotland?
1. Small Business Bonus Scheme (SBBS)
The Small Business Bonus Scheme is the most commonly accessed relief in Scotland and offers different levels of discount based on the rateable value (RV) of the property.
| Combined Rateable Value | Relief Level | Notes |
| Up to £12,000 | 100% | Full exemption if it’s your only property |
| £12,001–£15,000 | Tapered | Relief gradually decreases to 0% |
| £15,001–£20,000 | Sliding Scale | Calculated by the council, partial relief |
| £20,001–£35,000 | Up to 25% | Only if no individual property exceeds £15,000 |
For businesses with multiple premises:
- You can still apply if the total RV of all properties is under £35,000.
- Relief only applies if no individual property exceeds £20,000.
- Businesses must occupy the property to qualify.
- Exclusions: betting shops, payday lenders, car parks, car spaces, and advertising sites.
2. Rural Rate Relief
Businesses located in designated rural areas (population under 3,000) may be eligible for 100% rate relief under this scheme.
To qualify:
- Must be the only general store, food shop, or post office in the village, with a rateable value of £8,500 or less.
- Must be the only public house or petrol station, with a rateable value of up to £12,500.
- Properties must be occupied.
- If two different types of businesses operate (e.g., a pub and a shop), both can apply.
Your local council will confirm whether your area and business type meet the criteria and provide application guidance.
3. Fresh Start Relief
Designed to incentivise the reuse of long-term vacant properties, this scheme offers 100% relief for the first year of occupancy.
To qualify:
- Business must occupy the property on or after 1 April 2018.
- Property must have been empty for at least 6 months prior to occupation.
- The property must be actively occupied.
- The rateable value must be under £100,000.
Contact your local council to check eligibility or submit an application.
4. Day Nursery Relief
Businesses operating registered day nurseries can receive 100% relief on their non-domestic rates.
To qualify:
- The premises must be used only or mainly as a nursery school.
- Relief applies from April 2018 onwards.
- The property must be occupied and used for nursery activities.
Application is made through the local authority.
5. Disabled Persons Relief
Businesses providing specialised services for disabled individuals may be eligible for up to 100% relief.
You may qualify if you offer:
- Residential accommodation for people needing care or aftercare.
- Training programmes for people with disabilities.
- Welfare workshops or services specifically for disabled users.
Check with your local council for the full list of qualifying activities and how to apply.
Who Can Claim Small Business Rates Relief in Scotland?
To be eligible for small business rates relief in Scotland:
- Your property’s rateable value should be less than £15,000 for full or partial SBBS support.
- Relief is generally available for businesses with a single property, though some multi-property businesses also qualify.
- If you acquire a second property:
- You retain relief on the original property for 12 months.
- Relief may continue if no property exceeds £2,899 in RV and the total is under £20,000.
Note: You cannot receive both charitable relief and small business rates relief on the same property. Your council will determine which is applicable.
How Can Small Businesses Apply for Rates Relief in Scotland?
Application Steps:
- Visit your local council’s website to find the relevant form.
- Complete the SBBS or appropriate scheme application.
- Provide supporting documents like tenancy agreements or proof of trading.
- Submit the form and wait for assessment.
Each council has its own processing times. Relief is not always automatic, so early application is advised.
If your circumstances change, such as acquiring another property, leaving your premises, or expanding, it’s essential to report these to avoid incorrect billing.
How Much Money Can a Business Save with Rates Relief in Scotland?
Relief is directly linked to rateable value, with higher savings available for lower-valued properties.
| Rateable Value | Type of Relief | Estimated Saving (Annual) |
| £10,000 | 100% SBBS Relief | £5,300 |
| £13,500 | 50% SBBS Relief | £2,650 |
| £8,000 | 100% Rural Rate Relief | £4,000+ |
| £15,000 | Fresh Start (100%, 1 yr) | £7,800 |
Even if your business doesn’t qualify for SBBS, a lower small business multiplier (49.9p) applies for RVs under £51,000, reducing your total bill compared to the standard multiplier (55.5p).
What’s New for Business Rates Relief in Scotland in 2025?
Key updates from April 2025:
- The small business multiplier is set at 49.9p; the standard multiplier is 55.5p.
- The Supporting Small Business Relief Scheme continues for those impacted by the 2023 revaluation.
- Councils have expanded online application portals for easier access.
- The government has launched a pilot Green Business Relief, offering incentives for energy-efficient upgrades.
What Mistakes Should Small Businesses Avoid When Claiming Rates Relief?
To maximise your entitlement and avoid penalties:
- Don’t assume relief is automatic, you must apply.
- Report any changes in occupancy, usage, or property size.
- Track eligibility regularly, especially if your rateable value changes.
- Keep your council informed if you open, close, move, or renovate a property.
Failure to update your council may lead to backdated bills or loss of relief.
Where Can Small Businesses Find Support and Resources?
Here are useful links and support services:
- Scottish Assessors Portal: Check your rateable value.
- MyGov.scot Business Relief: Full relief guidance.
- Business Gateway Scotland: Free advisory services.
- Local Council Directory: Apply for reliefs and check eligibility.
If you think your rateable value is incorrect, you can appeal via your VOA (Valuation Office Agency) business rates account.
Why Is Business Rates Relief More Important Than Ever in 2025?
With increased costs, high energy bills, and tighter margins, business rates relief is no longer optional; it’s essential. These schemes:
- Help maintain profitability
- Allow reinvestment in local economies
- Provide crucial support during financial recovery
If you’re a small business owner in Scotland, ensuring you claim the right reliefs could save you thousands in 2025 and beyond.
Conclusion
In 2025, business rates relief remains one of the most valuable financial support tools available to small businesses across Scotland.
Whether through the Small Business Bonus Scheme, Rural Rate Relief, Fresh Start Relief, or other government-backed programmes, eligible businesses can benefit from substantial savings on their non-domestic rates.
With increasing pressure on SMEs due to rising operational costs, now is the time for business owners to review their eligibility, understand the latest updates, and take full advantage of the support on offer.
By applying for the correct relief and keeping local councils informed of any changes, small businesses can protect their cash flow, support sustainable growth, and thrive in a competitive marketplace.
If you’re running a business in Scotland, don’t miss out and check your eligibility today and claim what you’re entitled to.
Frequently Asked Questions
Can I get both small business and charitable relief?
No, you can only claim one. Your local council will determine which applies if you’re eligible for both.
What if I have more than one property?
You may still qualify if none of your properties exceeds £2,899 in rateable value and your total is under £20,000.
How does Rural Rate Relief work?
It offers 100% relief to eligible businesses in rural areas with populations under 3,000, including village shops, post offices, and pubs.
Who qualifies for Fresh Start Relief?
Businesses occupying properties that were vacant for at least six months, with an RV under £100,000, can receive 100% relief for one year.
What if I’m not receiving relief but believe I should?
Contact your local council immediately to review your eligibility and ensure your business is properly assessed.
What happens if my business changes location or expands?
You must notify your local authority. Relief could be adjusted based on your new rateable value or property changes.
Are day nurseries eligible for business rates relief?
Yes, if the premises are used only or mainly as a nursery, you may receive 100% relief.
