Brighton pubs, restaurants and bars after Budget 2026: pub relief rises to 35% and what it means for buying your freehold

Brighton and Hove has one of the densest clusters of independent pubs, restaurants, cafés and late-night venues in the south of England, from the North Laine and The Lanes to Kemptown, Hove and the seafront arches. Budget 2026 contains the most generous package of business rates help for that kind of business in years, most of it starting on 1 April 2027. This article, from Business Mortgages Broker, explains what has changed and why it matters if you are thinking about buying the freehold of the premises you trade from.

The headline: pub relief more than doubles

The government is "increasing the relief for pubs, social clubs and all but the very largest live music venues in England by 20ppt, from 15% to 35% from 1 April 2027" (Budget 2026, para 6.189). The Treasury puts the value at "an average of over £3,000 per pub next year" (para 3.21).

There is a cut-off. Venues "with a rateable value of £1 million or above" do not get the increase. They keep the 15% relief already announced for 2026-27 and a real-terms freeze for 2027-28 and 2028-29 (para 6.189). Very few Brighton pubs will sit anywhere near that line, but a large seafront music venue or a big multi-bar site could, so check your rateable value on the 2026 rating list before assuming the full uplift applies.

The government says it will keep the level of relief "under review alongside the 2029 revaluation" (para 6.189). Treat 35% as fixed for planning purposes up to then, and as uncertain after it.

Illustrative example. The figures are invented to show the arithmetic, not taken from any real pub.

• A pub's business rates bill before this relief is £20,000 a year.
• At 15% relief, the saving is £3,000 and the bill falls to £17,000.
• At 35% relief, the saving is £7,000 and the bill falls to £13,000.
• The extra £4,000 a year goes straight to trading profit, before tax.

Small Business Rates Relief: higher thresholds for hospitality and retail

The second change helps smaller operators of every hospitality type, not only pubs. For qualifying retail, hospitality and leisure (RHL) properties in England, "The threshold for 100% relief will increase to a rateable value of £18,000, and the threshold for tapered relief will increase to a rateable value of £21,000", up from £12,000 and £15,000 (para 6.190).

The Treasury's own estimate is that "an additional 3,500 pubs, 3,900 restaurants, 2,200 cafés and 1,700 hairdressers and beauty salons will pay no business rates" from next year (para 3.22), and that "half of all RHL properties in England will not pay business rates at all" (para 3.23).

For Brighton, where many cafés, bars and small restaurants occupy compact units on side streets, this may take a meaningful number of businesses out of rates entirely. Small Business Rates Relief has its own eligibility rules, including how many properties you occupy, so confirm your position with Brighton & Hove City Council rather than assuming you qualify.

Note the limits. These higher thresholds apply only to qualifying RHL properties. The Budget does not change thresholds for offices or industrial units (para 6.190). And vape shops lose access to both the RHL multipliers and Small Business Rates Relief from April 2027 (para 6.195).

A two-year inflation cap on bills

For larger RHL properties that are not taken out of rates altogether, bill increases "are capped by CPI inflation in 2027-28 and 2028-29" (para 6.191). The Treasury says that "over 14,000 restaurants will avoid an extra £7,500 paid over the two years" on average (para 3.22).

There is an important exclusion for anyone planning to buy and improve a building. The cap "does not apply to increases in rateable values resulting from improvements" (para 6.191). If you buy your freehold and then extend the kitchen, open up a basement or add a roof terrace, any rise in rateable value from that work sits outside the cap. Factor that into the cost of the project.

Why rates relief matters to a freehold purchase

Business rates are paid by the occupier, whether you rent or own. Buying the freehold does not change who pays the rates. What the Budget changes is the trading profit your business earns, and that is the figure a lender looks at first.

When you buy a pub, restaurant or bar freehold with a commercial mortgage, the lender is mainly asking one question: can the business comfortably pay the loan from its profits? Lower fixed costs mean more profit available to cover the debt. A pub that saves several thousand pounds a year on rates from April 2027 has a stronger affordability case than it did before the Budget, all else being equal.

There are three practical consequences:

• Lenders will want to see the saving, not just hear about it. Most will underwrite on actual accounts and current costs, with forecasts as support. A clear schedule showing your rateable value, the relief that applies from 1 April 2027 and the resulting bill helps an underwriter accept the lower cost base.
• Wage costs rise at the same time. The National Living Wage goes up by 3.9% to £13.21 an hour on 1 April 2027 (para 6.128). For a staff-heavy restaurant, the wage rise may absorb part or all of the rates saving. Lenders will model both, and so should you.
• Your landlord may be thinking the same thing. If you rent, your landlord will see that rates relief makes the business more profitable. That can affect rent reviews and the price a landlord asks if you approach them about buying. Knowing your numbers puts you in a better position for that conversation.

Other measures Brighton operators should know about

• Valuation Tribunal fees abolished. The government will "abolish the £150 and £300 fees charged by the Valuation Tribunal in England for non-domestic rating appeals", including refunds of fees already paid on the 2026 list (para 6.194). If you think your rateable value is wrong, appealing has become cheaper.
• Outdoor space. A regulatory sandbox will allow councils to test "making it easier for pubs, bars and restaurants to make better use of outdoor space" (Box 4.B). For venues with courtyards or pavement frontage, extra covers can change the value of a site.
• Help to rescue community pubs. An extra £65 million will help "communities across England rescue and revamp beloved buildings and businesses at risk of closure, like pubs and sports clubs" (para 4.66).
• Small brewers. Alcohol Duty Small Producer Relief becomes more generous from 1 February 2027, worth £10 million a year to over 2,000 producers (para 3.29). Brighton's microbreweries and brewpubs may benefit.
• Guest beers. The Budget refers to a Guest Beer provision in the Pubs Code for England and Wales (para 6.228), relevant to tied tenants weighing up whether to buy out of a tie.
• Till systems. Mandatory software standards for EPOS systems are planned to tackle "till fraud" (para 6.164). Clean, verifiable till records also make lender due diligence easier.
• The 1p supplement. Properties whose bills fell or rose only slightly at the 2026 revaluation keep paying a 1p Transitional Relief Supplement for two more years from 1 April 2027 (para 6.193).

What to do now

1. Look up your rateable value on the 2026 rating list and work out which reliefs apply from 1 April 2027: pub relief, Small Business Rates Relief at the new thresholds, or the inflation cap.
2. Write the saving into your forecast. Show your current bill, the expected bill from April 2027 and the source for each relief. Set the National Living Wage rise against it.
3. Check your rateable value is right. With tribunal fees abolished, there is less reason to leave an overstated valuation unchallenged.
4. If you rent, open the conversation early. If you have been thinking about buying your freehold, a clear set of numbers helps you judge a fair price and present a credible case to a lender.
5. Get your trading records in order. Lenders typically want two to three years of accounts, current management figures, licence details and, for pubs, information on any tie. Clean records shorten the process.
6. Plan improvements with rates in mind. If you intend to extend or refurbish after purchase, remember that rateable value rises from improvements fall outside the inflation cap.

Key dates

• 1 February 2027: More generous Alcohol Duty Small Producer Relief.
• 1 April 2027: Pub relief rises from 15% to 35%; new Small Business Rates Relief thresholds of £18,000 and £21,000 for RHL properties; inflation cap on RHL bill rises begins; National Living Wage rises to £13.21 an hour.
• 2027-28 and 2028-29: RHL bill increases capped at CPI inflation.
• 2029: Next revaluation, when relief levels and thresholds will be reviewed.

Brought to you by Business Mortgages Broker

This article is brought to you by Business Mortgages Broker, which arranges owner-occupier business mortgages for UK trading companies, including pubs, restaurants and other hospitality businesses buying the premises they trade from. Founder Matt Lenzie has 25 years in financial services, raising debt and equity, and has arranged around £400m of property finance. For more on buying your premises in the city, see the guide to business mortgages in Brighton.

Source: HM Treasury, Budget 2026 (HC 726), 28 October 2026. This article is general information, not tax or financial advice. Business rates measures described here apply in England.