You open the envelope from the district council and there is a figure that seems to have nothing to do with how many customers came through the door in January. Business rates do that to people. They are not a tax on profit or turnover — they are a tax on the property you occupy, which is why a quiet month does not move the bill and a good one does not either. Understanding that distinction makes the rest of the system far easier to deal with.

Here is how rates work for small shops in Devon, which reliefs are worth asking about, and what to do when the number on the bill looks wrong.

How your bill is calculated

Every non-domestic property has a rateable value, set by the Valuation Office Agency (VOA). It reflects the annual rent the premises could reasonably be let for on the open market at a fixed valuation date — not the rent you actually pay, and not your turnover. A small unit on a side street in Okehampton and a similar unit on a busy parade in Exeter can carry quite different values for reasons that have nothing to do with your takings.

Your bill is roughly rateable value multiplied by the multiplier, sometimes called the poundage, which central government sets each year. There are two: a lower small business multiplier for smaller premises, and a standard one above that threshold. Your district council then applies any reliefs you qualify for, adjusts for any periods the property stood empty, and splits the total into instalments. Revaluations come round more often than they once did, so the value on your bill is not fixed forever.

Three practical consequences are worth knowing:

• If you occupy a property but are not trading from it, you will usually still be charged.
• Empty shops normally get a short exemption period — often around three months — before full rates resume.
• Liability usually sits with the occupier, but check your lease, because some agreements place it elsewhere.

Relief schemes small shop owners often miss

Most reliefs are not automatic. They have to be applied for, and some need renewing. If you have never asked your council for anything, do it this week.

• Small Business Rate Relief. If you occupy a single property with a rateable value of £12,000 or less, you may qualify for 100 per cent relief. Between £12,001 and £15,000 it tapers away. Taking on a second premises changes the calculation, so speak to the council before you sign a new lease.
• Retail, Hospitality and Leisure relief. Aimed at shops, cafés, pubs, restaurants and hotels. The percentage has been revised year by year, so check the current figure on your council's website rather than trusting what a neighbouring business told you last spring.
• Rural rate relief. Relevant across much of Devon. In some small rural settlements the only village shop or post office can qualify — ask your district council whether your parish meets the criteria.
• Transitional relief. If your bill rose sharply after a revaluation, this may cap the increase.
• Charitable and community relief. Available to charities and some community interest companies, sometimes with a discretionary top-up from the council.
• Hardship relief. Discretionary and not handed out freely, but it exists for businesses in genuine, temporary difficulty.

If the rateable value looks wrong

Mistakes happen. Floor areas get carried over from a previous occupier, a storeroom is counted as retail space, or a change of use was never recorded. There is a formal three-stage process: Check, Challenge, then Appeal.

1. Start with a Check through the VOA's service and confirm the facts it holds: floor area, layout, description and effective date.
2. If those facts are wrong, move to a Challenge and propose a different value, backed by evidence such as a floor plan, photographs or rental details.
3. If the challenge is not resolved, the matter goes to appeal. Deadlines apply at each stage.

Timing catches people out. Each rating list runs for a fixed period, and a challenge generally has to be lodged before that list closes rather than months afterwards. There is also an obligation on ratepayers to tell the VOA about changes to a property within a set window, so do not sit on news that the layout has altered.

For anything complicated — multiple sites, unusual premises, a large value — an accountant or a rating surveyor is worth the fee. For most small shops, a Check is free and takes twenty minutes.

Payment plans and difficult months

Business rates are normally payable in ten monthly instalments from April, and most councils will spread them over twelve if you ask. A Direct Debit on a date that suits your cash flow is the simplest arrangement.

When trade is slow, the mistake people make is going quiet. Arrears move quickly from a reminder to a summons and then to enforcement agents, with costs added at every stage. Councils have more discretion than their letters suggest. Ring the business rates team before the instalment date, explain the position, and ask what they can do. Bespoke arrangements are common. Hardship relief is rarer but real.

Do not cancel a Direct Debit to make a point. Agree a change first, preferably in writing. If you are already behind and juggling other debts, free services such as Business Debtline can help you work out what to offer and in what order.

This is general information, not financial or legal advice. For arrears, a lease dispute or a significant rateable value, speak to an accountant, solicitor or rating surveyor.

Who to contact in Devon

Business rates are billed and collected locally, so your first call is to the council that sends the bill:

• Exeter — Exeter City Council
• East Devon, Mid Devon, North Devon, South Hams, Teignbridge, Torridge and West Devon — the relevant district council
• Plymouth and Torbay — the unitary councils, if you trade in those areas
• Rateable value queries — the Valuation Office Agency, not the council

Search your council's name plus "business rates" for current relief forms and contact details, and have your account number to hand. A phone call beats a web form for anything time-sensitive.

Your next five steps

1. Find last year's bill and check the rateable value, the multiplier used and every relief listed.
2. Look the property up on the VOA's public rating list and compare it with what you see on the ground.
3. Apply in writing for any relief you are not currently receiving, and keep a dated copy.
4. If the value looks wrong, start a Check now rather than next spring — deadlines follow the rating list, not your convenience.
5. If money is tight, call the business rates team before the next instalment date and ask for a revised arrangement.

Rates are a dull subject, which is precisely why so many small shops overpay for years without noticing. The rules are published, the forms are online, and the staff at the other end of the phone deal with independents every day. Twenty minutes with your bill, a calculator and a cup of tea is usually enough to work out whether you are paying the right amount — and occasionally enough to get some of it back.

Photo: Polina Tankilevitch / Pexels