Rates relief 'specialists' targeting unsuspecting business owners and charging unnecessary fees to help them reduce their business rates have been condemned by a district council.

The so-called specialist companies – often mimicking statutory bodies and giving the impression they are part of the official appeals process – ask businesses to sign contracts which promise to secure a rate reduction, but which could incur costs of hundreds of pounds.

North Norfolk District Council, which presides over an area facing some of the region's biggest business rates hikes following April's revaluation, has warned businesses to be aware of the small print when taking advice.

In some cases, firms have been urged by these advisers not to fully disclose their circumstances to the council in order to achieve better outcomes – which can leave businesses at risk of fraud charges.

These companies have been compared to those charging fees for European health insurance cards (EHICs), which can be obtained for free from the government, or offering to launch payment protection insurance (PPI) compensation claims.

A spokesman said some companies used branding which suggested a 'formal connection to the rate-relief process' they do not have.

'Businesses that dispute these invoices could find themselves threatened with legal action and county court judgments,' he added.

Applying for small business rate relief is free and can be done through the council. The authority added that employing a third-party company does not help or influence the outcome of an application.

Wyndham Northam, cabinet member for revenues and benefits, said: 'Some private operators are very clever at selling their services, but signing up with them can result in being charged an arm and a leg.

'What makes it even worse is that the small print means some of them continue to chase businesses for payment even if the rate relief is subsequently secured without the help of these so-called specialists.'

A spokesman for Waveney and Suffolk Coastal District Councils, whose local businesses were also set for large rates increases, warned companies that there should be no charge for reductions in their business rates. Anglia Revenues Partnership (ARP) offers business rate relief and challenges for the two councils.

Small businesses concerned about unfair contracts are encouraged to contact Citizens Advice.