As the Coronavirus pandemic continues, business across all sectors and industries are being impacted, leading the government to constantly assess the need, requirements, and actions available to support businesses.
At the end of March, Chancellor Rishi Sunak announced the nationwide furlough scheme, which guaranteed to pay up to 80% of the wages for any staff member whose job was under threat due to the impact of the virus.
This scheme, designed to keep people in jobs and prop up the UK economy, was originally set to end in June, but has since been extended to the end of October 2020.
For businesses, the main Coronavirus support priorities are:
- Loans, tax relief and cash grants
- Covering up to 80% of staff pay through the furlough scheme
- Providing self-employed individuals with up to £2,500 in grants per month
Business Grants available in the UK
The UK business grant schemes were announced on 11th March 2020, and were further increased by the Chancellor on 17th March. This support was designed to cover small businesses, and businesses across the retail, leisure, and hospitality sectors.
The provision of grants
Upon announcement, the government confirmed that they would reimburse Local Authorities who provided grants to eligible businesses.
Small Business Grant Fund
Intended for all businesses in England who receive Small Business Rates Relief (SBRR) or Rural Rates Relief (RRR). Any eligible business can receive payment of up to £10,000 depending on the criteria.
Retail, Hospitality and Leisure Grant Fund
Intended for all business in England who would have received the Expanded Retail Discount on 11th March, and whose value is less than £51,000:
- Businesses with property up to the value of £15,000 are eligible for a grant of £10,000
- Businesses with property with a value between £15,000 and £51,000 are eligible for a grant of £25,000
- Businesses with property value of £51,000 and over are not eligible for a grant
To read more about the small business grant and the retail, hospitality and leisure grant, click here.
Self-employed individual support
The scheme to support self-employed individuals allows these workers to claim a taxable grant of up to 80% of their average monthly trading profits – to be paid in a single instalment which covers three months. The maximum payment available on release was £7,500 per person.
This grant does not need to repaid but is subject to income tax and self-employed National Insurance payments.
Read more about self employment business grants here.
Paying for these business grants
At the end of March when business grants were first announced, Chancellor Rishi Sunak revealed that the guaranteed support provided by the government via business grants, furlough payments, and other support schemes, would amount to £330 billion – and would likely rise if necessary.
As of 27th April, over £7.5 billion has been paid out to over 614,000 business properties via the two main business grant schemes. This is over 61% of the grant funding allocated to local authorities.
By the beginning of May, an additional £617 million was added, to cover business grants for those who fell outside the initial criteria. The additional fund was created to support small businesses with ongoing property-related costs, who are still unable to open.