BIM46835 - Specific deductions: rent & rates: business rates

Business rates are payable in respect of non-domestic premises. If part of the premises is used for domestic and part for non-domestic purposes, the charge is limited to the non-domestic part. Business rates are therefore usually an allowable deduction in computing profits assessable under Schedule D Cases I, II or under Schedule A.

If, exceptionally, the premises, or those parts of the premises, chargeable to business rates are in fact used for non-business purposes, a proportion of the expenditure should be disallowed.