NON DOMESTIC RATES - KEY CHANGES AHEAD OF THE 2026 REVALUATION

Scotland’s next non‑domestic rates revaluation will take effect on 1 April 2026, using property values as at 1 April 2025. Draft valuations were released on 30 November 2025, and early indications suggest significant impacts for self‑catering accommodation and rural enterprises.

New assessment methodology means that, where local rental evidence is limited, assessors will use national bed‑space rates. Scottish Land & Estates reports increases in rural “Fair Demand” areas from around £550 to approximately £1,200 per bed‑space. As a consequence, many self‑catering properties are likely to see higher rateable values, pushing them over eligibility thresholds for the Small Business Bonus Scheme (SBBS). The Scottish Assessors’ Association has since published an updated practice note containing a revised valuation matrix providing new national bedspace rates.

Small Business Bonus Scheme – new restrictions

The Scottish Budget presented on 13 January 2026 confirmed continuation of the SBBS but new restrictions from 1 April 2026 are to be introduced. 

Shootings and deer forests will no longer be eligible except for: 

• shootings or deer forests on which shooting rights are (1) not exercised in practice or (2) exercised solely for environmental management or the prevention of agricultural or woodland damage, with any deer shot made available as venison; and
• shootings where (1) the land forms part of a croft, agricultural holding or small landholding or (2) the rights are leased either to new entrant farmers or in accordance with the as yet to be published model environmental lease under the Land Reform (Scotland) Act 2025.

Properties requiring a short‑term let licence will only receive SBBS relief if a valid licence is in place.
Given that short-term lets must already be licensed, this appears to be a new cross‑compliance measure linking business rates relief to licensing enforcement.

Small Business Bonus Scheme - transitional reliefs

The Scottish Budget introduced transitional reliefs for business losing reliefs. Eligible ratepayers will pay 25% of the increase in 2026/27, rising to 50% in 2027/28 and 75% in 2028/29 before the full amount applies. Again, properties requiring a short-term let licence will only receive relief if a valid licence is in place. 

The Scottish Government has announced that there will be an alternative relief for those self-catering properties with the requisite licence to operate seeing the highest increases at revaluation, which will cap increases in gross bills at 15% year-on-year up to the next revaluation. 

Next steps

These changes, including the new SBBS eligibility conditions and transitional protections, have now been laid before the Scottish Parliament and will come into force on 1 April 2026 subject to the remaining parliamentary procedures. The 2026/27 poundage rate has already been confirmed. All remaining decisions – including the detail of the alternative transitional relief for those self-catering properties seeing the highest increases at valuation – are expected to be finalised before the new valuation roll begins on 1 April 2026.

If you would like to discuss any of these aspects further, please get in touch with your Turcan Connell contact or email enquiries@turcanconnell.com.