Wales phases 2026 business rates rises over 3 years
From April 2026, Wales will soften the jump in business rates that some properties face after revaluation. The Welsh Government’s scheme spreads increases across three financial years: 2026–27, 2027–28 and 2028–29. This explainer shows you how to read your bill and run the numbers yourself, using the official guidance as our reference point.
Here is the plain-English version. If your bill would rise by more than £300 because of the 2026 revaluation, the extra amount is phased: 67% of the increase is removed in 2026–27 and 34% is removed in 2027–28. By 2028–29 you reach the full bill that the revaluation implies. Welsh Government calls this “transitional relief” and says it is fully funded.
Why Wales can do this matters for your media literacy. Business rates (non‑domestic rates) are devolved. New Welsh rating lists are compiled for local areas and for the all‑Wales central list, and revaluations now happen every three years starting in 2026. That timetable and the Welsh‑specific lists are set out in the Local Government Finance (Wales) Act 2024.
Two terms unlock the calculation. Base Liability (BL) is your annualised chargeable amount on 31 March 2026. Notional Chargeable Amount (NCA) is the annualised amount you would pay from 1 April 2026 if there were no phasing. Transitional relief only applies where the increase is more than £300 and is worked out from the gap between NCA and BL.
Eligibility is tight because the scheme is designed to smooth existing bills, not subsidise new tenancies. To qualify, the same ratepayer must have occupied the property on 31 March 2026; the property must appear on the local or central list; the jump in liability must exceed £300; and there must be no section 44A part‑occupation apportionment in play. If those tests fail, the relief is not available.
Worked example 1 (a small shop on a local list). Imagine your BL is £6,000 a year and your NCA is £9,000. The increase is £3,000. In 2026–27, 67% of that increase (£2,010) is removed, so you pay £6,990. In 2027–28, 34% of the increase (£1,020) is removed, so you pay £7,980. From 2028–29 you pay the full £9,000, subject to any other reliefs you receive.
Worked example 2 (a larger office). BL £150,000; NCA £170,000. The increase is £20,000. In 2026–27, relief removes 67% (£13,400), so you pay £156,600. In 2027–28, relief removes 34% (£6,800), so you pay £163,200. In 2028–29 you pay £170,000 (again, before any separate reliefs).
A quick sense‑check if your bill rises by less than £300. Suppose BL is £7,200 and NCA is £7,450. The increase is £250, so the threshold is not met and transitional relief does not apply. You move straight to the £7,450 bill in 2026–27. This is deliberate policy: the scheme targets larger jumps.
The maths runs day by day. Rates are calculated on a “chargeable day” basis, so your actual deduction pro‑rates across the year. Note that 2027–28 spans February 2028, a leap year, so the daily calculation for that year uses 366 in the denominator. Expect small differences if you move in or out mid‑year because the relief follows days of liability.
What happens if things change mid‑scheme? If your chargeable amount falls during the period (for example after a successful valuation change), the NCA used in the calculation is reset from the effective date of that change. There is no reset if the chargeable amount increases. If you cease to be the ratepayer, you still receive relief for the days you were liable, provided you were the occupier on 31 March 2026.
Where this sits with other policies. Statutory reliefs that form part of the chargeable amount (for example, under section 43 for occupied properties) are applied first; the transitional deduction comes next; any local discretionary top‑ups are applied afterwards. For 2026–27, Wales is also introducing differential multipliers-a lower retail rate for smaller shops and a marginally higher rate for the largest properties-alongside a reduced standard multiplier. These were confirmed in a written statement on 3 December 2025 and subsequent guidance.
Practical next steps. Keep your March 2026 bill safe, as it anchors BL; check your 2026 list valuation; and compare the two figures. If you meet the conditions, local authorities will apply the deduction automatically for local‑list properties, and the Welsh Government will adjust bills for central‑list entries. If you think a bill is wrong, contact your billing authority first-Welsh Government guidance says they administer the scheme day to day.