Chancellor Rishi Sunak has announced one-off top-up grants from 5 January 2021 for hospitality, retail and certain other businesses in the service sector totaling up to £9,000.
The grants are expected to support and benefit over 600,000 businesses. This money will not have to be paid back.
The Chancellor will consider any extension to this scheme or any prior incentives like the Coronavirus Large Business Interruption Loan Scheme on 3 March, when the Budget is decided.
We’ve put together all you need to know about Rishi Sunak’s latest grant for businesses struck hardest by the pandemic, including how to apply, what you get and the eligibility criteria.
Disclaimer: While we are providing the most up-to-date information about schemes for your business, it is important to note that they can change at any time. This article has been collated and summarised from Her Majesty’s Revenue and Customs and the Gov.uk websites. This article is not intended as financial advice.
How to apply
Local councils are in charge of providing grants to your business – please refer to your local government’s website to find out if they offer a cash grant as of 5 January 2021. Information for businesses can normally be found on a dedicated page – for example, here on Southampton’s local government website. Please contact your local authority regarding whether they offer the grant if you cannot find the relevant application form on their website. Find your local council’s site here.
Qualifying businesses should note that these grants will be offered per property. If your business has multiple locations across the United Kingdom, you may need to submit separate grant requests to the relevant local council or government your properties fall under.
What you get
The grant will be based on the rateable value of the property on the first full day of restrictions.
If your business has a property with a rateable value of £15,000 or less, you may be eligible for a cash grant of £1,334 for each 28-day qualifying restrictions period.
If your business has a property with a rateable value over £15,000 and less than £51,000, you may be eligible for a cash grant of £2,000 for each 28-day qualifying restrictions period.
If your business has a property with a rateable value of £51,000 or above, you may be eligible for a cash grant of £3,000 for each 28-day qualifying restrictions period.
Your business may be eligible if it:
- is based in England
- occupies property on which it pays business rates (and is the ratepayer)
- has been required to close because of the national restrictions from 5 November to 2 December 2020, and/or has been currently asked to close.
- has been unable to provide its usual in-person customer service from its premises
For example, this could include non-essential retail, leisure, personal care, sports facilities and hospitality businesses. It could also include businesses that operate primarily as an in-person venue, but which have been forced to close those services and provide a takeaway-only service instead.
Eligible businesses can get one grant for each non-domestic property.
Businesses excluded from the fund
You cannot get funding if:
- you can continue to operate during the period of restrictions because you do not depend on providing direct in-person services from your premises (for example accountants)
- you have chosen to close, but have not been required to close as part of national restrictions
- your business is in administration, insolvent or has been struck off the Companies House register
- you have exceeded the permitted state aid limit
You must notify your local council if your situation changes and you no longer meet the eligibility criteria.
If you already get state aid
EU state aid rules apply to all payments made before 1 January 2021, hence, the following values in this section are valued under the Euro currency.
LRSG (Closed) Addendum counts towards the total de minimis state aid you’re allowed to get over a 3-year period – €200,000.
If you have reached the de minimis threshold, you may still be eligible for funding under the COVID-19 Temporary Framework. The limit for this framework is €800,000 under Section 3.1 of the Framework.
If you have already reached the de minimis threshold and the €800,000 limit under the COVID-19 Temporary Framework, you may be able to receive further grant funding. This subject to a number of conditions under Section 3.12 of the Temporary Framework.
Your local council will ask you to complete a declaration confirming that:
- you will not exceed the relevant state aid threshold
- you will need to provide additional evidence to receive payments under Section 3.12 of the Temporary Framework
- you were not an ‘undertaking in difficulty’ on 31 December 2019 (this applies to the temporary framework only)
The undertaking in difficulty test does not apply to small and micro undertakings (less than 50 employees and less than €10 million of annual turnover or annual balance sheet), unless any of the following apply:
- the business is already in insolvency proceedings
- the business has received rescue aid that has not been repaid
- the business is subject to a restructuring plan under state aid rules