England only
Business rates are devolved. Everything below applies to England. Scotland, Wales and Northern Ireland set their own multipliers and reliefs, and none of the figures here carry across.
If you run a pub, you have probably seen the headline: a 20% cut to business rates from April 2027. It is real, it is worth having, and it is not yet law. Nothing about it appears on a bill you can pay today, and one of its conditions has not been written yet.
Meanwhile a larger change already happened, on 1 April 2026, and it is the one actually sitting in your current bill. Worth understanding that one first.
What actually changed on 1 April 2026
Two things landed together.
The first is structural. England now has permanently lower business rates multipliers for retail, hospitality and leisure properties, replacing the temporary relief that had been rolled over budget to budget for years. The RHL multipliers sit 5p below their national equivalents.
If your rateable value is £500,000 or more you get no RHL discount at all — the higher multiplier applies regardless of what you do in the building. That threshold is what pays for the rest: large distribution warehouses fund the cut for in-person trade.
The second is a straight discount. Pubs and live music venues get 15% off the bill for 2026-27, on top of the RHL multiplier. It is calculated daily, as 15% of the charge remaining after any mandatory relief.
Two details that matter more than they look. There is no cash cap on this relief, and it sits outside the Minimal Financial Assistance limit under subsidy control. If you run several sites, that is unusual and in your favour — most reliefs of this kind stop once a group hits a threshold. This one does not.
Whether you count as a pub is narrower than you think
This is where operators lose money, and it is worth being pedantic about.
Definition
Pub, for the purposes of this relief
A property must meet all four conditions: open to the general public; free to enter, except for occasional entertainment; customers are allowed to drink without buying food; and there is a bar serving drinks.
Read that third condition again. A venue where every table is a covered dining booking, and you would not seat someone who only wanted a pint, is a restaurant for this purpose — whatever the sign outside says. Plenty of gastropubs are genuinely borderline.
The published exclusions are explicit: restaurants, cafes, nightclubs, snack bars, hotels, sporting venues, festival sites, theatres, cinemas, museums and casinos do not qualify. A live music venue qualifies on a different test — wholly or mainly used for live music performance to an audience — and is excluded if it is primarily a nightclub or a theatre.
The common mistake
Assuming the 15% is on your bill because you are in hospitality. It is not a hospitality relief — it is a pub and live music venue relief, with a four-part test. Check your bill rather than assuming. If a local authority has misclassified you, that is a correction worth chasing, not a rounding error.
What this is worth on a real bill
Take a pub with a rateable value of £30,000 — below the £51,000 threshold, so the small business RHL multiplier applies.
That £3,219 is the part that is certain. It is in force, it is on your current bill, and it does not depend on anything being announced later.
Rates are a fixed cost — you cannot schedule around them the way you can wages. Which is why it is worth knowing what proportion of your takings is going on staff before you model anything else; the labour cost calculator will give you that in about a minute.
The 20% for 2027 is announced, not law
On 23 July 2026 the government announced a further 20% cut for pubs, clubs and live music venues from 2027-28, on top of the existing support. Alongside it, a commitment that bills will be frozen in real terms in 2027-28 and 2028-29 — meaning they rise by inflation only. The package is put at around £100 million a year across roughly 32,000 premises, with a typical pub saving an estimated £1,100.
Here is the part the headlines skipped.
Three reasons not to budget for it yet
It is an announcement of intent. It has not been legislated. Announcements at this stage have been changed and withdrawn before.
One eligibility condition does not exist yet. The government has said the 20% will not go to the very largest live music venues, and that the detail will be set out at the Budget. Until then, nobody can tell you where that line falls.
The mechanics are unpublished. The 15% is defined precisely — 15% of the daily charge after mandatory relief. Nothing equivalent has been published for the 20%, so how the two interact, and what they are each applied to, is not yet knowable.
There is also a funding question. Part of the package is tied to a consultation on VAT marketplace liability. Measures funded by a consultation that has not concluded are not measures you should have in a cash flow forecast.
What to do before the Budget
Three things, none of which take long.
- Check your rateable value. It changed on 1 April 2026 — the revaluation used values as at 1 April 2024. If yours moved and you have not looked, you are budgeting off a number that no longer exists.
- Check the 15% is actually on your bill. Against the four-part test, not against what you call yourself. If it is missing and you qualify, raise it with your billing authority now rather than at year end.
- Model 2027 without the 20%. If it lands, it is upside. If you have already spent it and the Budget carves you out, that is a hole in a year where you have no other lever.
The 15% is money. The 20% is a press release with good intentions behind it. Treat them differently until the Budget says otherwise — and this post gets rechecked when it does.