MORE than 2,000 of Colchester's small businesses could save themselves nearly £9 million if they applied for business rate relief, research has found.

Businesses which pay less than £15,000 in business rates are entitled to claim up to half back under the Small Business Rate Relief Scheme.

In Colchester only 31 per cent of claim for the discount (1,130 businesses), which saves them each on average £3,500 every year, but 2,547 either do not know they can claim, or have not done so, according to the Federation of Small Businesses (FSB).

Essex-wide, 18,700 small businesses are failing to claim rate relief - higher than two years ago - leaving £44.6 million of rate relief unclaimed, according to figures collected from councils by the FSB.

"This saving can go straight into the profits and allows businesses to reinvest it back into the business. They can expand or take on more staff," explained Steve Collie, national FSB vice chairman.

The FSB said local authorities should ensure small businesses are constantly made aware of the scheme.

"We are really going to hammer the councils to make sure they do what they can," said Bill Pirie, chairman of the FSB, Essex region.

He said Colchester Council does feature a notice about the discount on its website, but its last mail shot to businesses was in December last year.

In comparison, Mr Pirie said Tendring Council's economic development officer physically goes out and visits small businesses with the form and gets them to fill it out there and then.

In addition, "Tendring sent letters out in March 2007 and sent a reminder in June 2007," said Mr Pirie.

In Tendring while 60 per cent of businesses claim the discount (4,101 businesses), 2,761 do not which means they are missing out on £9.6 million.

Small businesses in Chelmsford had the best take-up of the rate relief at 68 per cent, and Harlow the worst with just 20 per cent. Four Essex authorities, including Maldon, didn't supply their figures on how many businesses take up the rate relief.

The FSB works with business organisations to get the message across but said the Government needs to change regulation so eligible businesses receive the discounted rate automatically on their bill, rather than having to fill out a form.

But in the meantime Mr Pirie added councils need to "drive that message home that this relief is easy to claim - how often can small business boost its income by £3,500 by taking ten minutes to fill in a form which covers just one side of A4 paper?"