The UK Budget reset business rates. Hospitality still has to find the margin.
Lower multipliers for smaller venues, higher bills for big ones, and another rise in the wage floor. What the 26 November 2025 Budget means for operators from April 2026.
By the Xuru Technologies team · 27 November 2025
Key takeaways
- From April 2026, retail, hospitality and leisure properties get permanently lower business rates multipliers, paid for by a higher multiplier on properties with rateable values above £500,000.
- The temporary 40% relief ends at the same time, and a revaluation lands, so many venues will still see bills rise.
- The National Living Wage rises again in April 2026, so labour costs keep climbing.
- The cheapest margin to win back is commission: every booking you move from a third party to your own site is money kept.
Hospitality went into the Chancellor's second Budget hoping for relief. It came out with a structural change to business rates that helps some venues and disappoints many others. If you run a pub, restaurant, café or hotel in the UK, the numbers that matter all start in April 2026.
What happened
On 26 November 2025 the government confirmed a new permanent system of lower business rates multipliers for retail, hospitality and leisure (RHL) properties, alongside a higher multiplier for properties with a rateable value of £500,000 or more. KPMG's Budget summary sets out how the new multipliers interact with the 2026 revaluation, and the government published its own multiplier effects paper.
The catch is timing. The existing 40% RHL relief ends in April 2026, the same month new rateable values take effect. Trade body UKHospitality warned that, for many sites, the lower multiplier will not fully offset the loss of relief and higher valuations.
What it means for operators
- Bills vary by site. Two venues on the same street can land in very different places depending on their new rateable value. Check your draft valuation now.
- Labour stays the biggest line. The wage floor rises again in April, so staff time spent on phones, inbox enquiries and manual bookings gets more expensive.
- Price rises are hard. Guests are price sensitive, so margin has to come from cost and channel, not only menu prices.
Five moves to protect margin before April
| Move | Why it helps |
|---|---|
| Push direct bookings | Third-party commission on rooms or tables is often the largest controllable cost after staff. |
| Automate enquiries | An on-site assistant answers opening hours, menus, allergens and availability without staff time. |
| Sell pre-orders and deposits | Cuts no-shows and smooths kitchen prep for busy dates. |
| Fix local search | Accurate Google listings and fast mobile pages win "near me" searches. |
| Track every channel | Know which bookings are profitable before you spend on marketing. |
Frequently asked questions
When do the new business rates multipliers apply?From April 2026, alongside the revaluation. Check your draft rateable value with the Valuation Office Agency and ask an adviser how the new multiplier applies to your site.
From April 2026, alongside the revaluation. Check your draft rateable value with the Valuation Office Agency and ask an adviser how the new multiplier applies to your site.
Will every hospitality venue pay less?No. The lower multiplier helps, but the end of the 40% relief and higher valuations mean many venues may still pay more. It depends on each property.
No. The lower multiplier helps, but the end of the 40% relief and higher valuations mean many venues may still pay more. It depends on each property.
What is the fastest digital saving for a venue?Moving repeat guests to direct booking on your own website. It removes commission on every booking that switches and gives you the guest relationship.
Moving repeat guests to direct booking on your own website. It removes commission on every booking that switches and gives you the guest relationship.
Keep more of every booking from April 2026.
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