The government’s new business rates plan is here. The headlines are full of forecasts of sharp increases and business closures. Whatever the changes, how can small firms manage the costs and the impact on cash flow?

It’s not easy to get a clear read on the new business rates schedule, even though the details have been around for some time. A lot of headlines are screaming doom and gloom, but others are less pessimistic, while the government is claiming that many businesses will benefit from lower rates as a result of its reshaping of the tax system. It feels like the proof will be very much in the pudding.

There are sources that claim that some firms face a spike in payments of as much as 80% and that the increase in bills could force as many as 340,000 businesses to close, with 1.4 million firms facing the prospect of having to make redundancies. At the same time, the Chancellor has commented that the reform will deliver permanently lower rates for the likes of retail, hospitality and leisure businesses, with the largest properties carrying more of financial load.

Regardless of the forecasting, the uncertainty is unwelcome at a time when the pressure on small businesses appears relentless. There are myriad demands on small firm cash flow, from costs relating to cyber-security and AI to those linked to decarbonisation and late payment. Furthermore, there is the prospect of rising oil prices checking the fragile economic recovery.

How alternative finance can help with new business rates costs

Undoubtedly some firms will be facing higher business rates bills, not at least as the Covid-era reliefs have been ended, although the government has put in place targeted business rates support for pubs, retail and hospitality after campaigns highlighting closures.

Nevertheless, managing the impact on cash flow at the time when margins are being stretched incredibly thin will be difficult. Access to finance is critical, as ever, but with legacy lenders continuing to be cautious when it comes to small businesses, this is far from straightforward. This is where alternative finance can help.

In response to this squeeze, alternative finance has become into a vital lifeline. Solutions such as invoice finance, asset finance and peer-to-peer lending are filling the funding gap, offering speed, affordability and tailored support. These agile funding facilitates are helping small businesses survive and target stability and growth.

Dealing with business rates: options for accessing small firm finance in 2026

The introduction of the new business rates plan has been long trailed but it’s arrival has been jolting nevertheless. The complexity surrounding the reform doesn’t help, but this is arguably immaterial to firms that will have to find the cash to pay higher bills.

Overcoming this challenge, and its impact on cash flow, in such an unpredictable market environment will be a test of businesses’ financial planning and flexibility. This is why it is important that key decision-makers are aware of all the finance options available to them, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.