The Government has announced an improvement to the grants that are currently available for small businesses.
The two schemes currently in place, Small Business Grants Fund and Retail, Hospitality and Leisure Grants Fund are funded by £12.33 billion from the government.
As of 27 April, over £7.5 billion has been paid out by those funds to over 614,000 business properties – but those schemes only helped businesses that were subject to paying business rates!
There are thousands of small businesses that do not pay any business rates but have ongoing fixed property costs, such as those operating in business centres or in shared properties where the landlord usually accounts for non-domestic rates and includes a contribution as part of the rent payment.
The government’s new fund of £617 million is being released to local authorities across England and it is at their discretion how this money should be allocated. The government has, however, asked local authorities to prioritise businesses in shared spaces, regular market traders, small charity properties that would meet the criteria for Small Business Rates Relief, and bed and breakfasts that pay Council Tax rather than Business Rates. This scheme has been called the Discretionary Grants Scheme.
So who is eligible?
In order to qualify, businesses must meet the following criteria:
- Have fewer than 50 employees, and
- Be able to demonstrate that they have seen a significant drop in income due to Coronavirus
Business already claiming under another government grant scheme will not be able to apply, these schemes include:
- Small Business Grant Fund
- Retail, Hospitality and Leisure Grant
- Fisheries Response Fund
- Domestic Seafood Fund
- Zoos Support Fund
- Dairy Hardship Fund
The government has stated that you are still able to apply for coronavirus-related loans if they apply for the Discretionary Grant Scheme.
How much could I receive?
There are three levels of grant available:
- £25,000 – the maximum available ,
- £10,000, or
- Local authority discretionary grants of any amount below £10,000.
The Discretionary Grants Fund counts towards state aid.
Payments of £10,000 or less count towards the total de minimis state aid you’re allowed to get over a 3 year period – €200,000. If you have reached that threshold already, you may still be eligible for funding under the COVID-19 Temporary Framework, which the limit is €800,000. Payments of £25,000 count as state aid under the COVID-19 Temporary Framework.
Your local council will ask you to complete a declaration confirming that:
- You will not exceed the relevant state aid threshold.
- You were not an undertaking in difficulty on 31 December 2019. This applies only to the COVID-19 Temporary Framework.
For many local councils, the amount of grants available will be up to £10,000 to help as many businesses as possible, but there may be occasions that £25,000 is paid to some businesses.
How do I apply for this scheme?
You will need to visit your local council’s website to find out how to apply. To find your local council you can search the government’s website, here.
These grants are not automatic – you will need to apply and this application needs to be made before the closing date!
What happens after I apply?
Your local council will run an application process and decide whether to offer you a grant.
You do not have to pay the grant back, but it will be taxable!
We are here to support your business, if you have any concerns please call us or email Mark or Andrew.
The content in this blog is correct as at 29/05/2020. See terms and conditions.