Finding small business grants in the UK can be difficult, as eligibility is determined by a variety of variables. Having said that, it's not hard to obtain non-repayable sources of small business grants; you only need to learn how to get grants for small businesses.
It's no secret that businesses, particularly small firms and new startups, are struggling right now. There is plenty of assistance available in the shape of loans, relief, tax cuts, and rate freezes, and small business grants, which we will discuss today in this guide.
Before we move forward, let's understand the difference between grants and loans for a small business.
What's the difference between a grant and a loan for a small business?
A small business loan is money for your company that you must repay over a set period of time. This is not the same as a small business grant, which you will not be required to repay.
What is the definition of a small business grant?
Government grants come in a variety of shapes and sizes, ranging from cash deposits to tax reliefs. Government business grants can be classified into the following categories:
- Equity finance
If a company is less than two years established and has fewer than 25 employees, it may be eligible for income tax and investment discounts.
- Grants made directly
When money is given directly to a new business to pay start-up costs such as equipment and employee training, this is known as a direct credit. Many grants will require your company to contribute half of the grant's value.
- a low-interest loan
These are usually government-backed and can provide more favorable repayment terms and circumstances than loans offered by banks and building societies. This could result in reduced interest rates or longer repayment periods for your company.
How to Apply Small Business Grant?
If you're starting a business in the London Borough of Bromley, start with the Business Finance Support Finder. The business finance help for your small business will depend on where you are in the country, how big your company is, what industry you're in, and whether you're considering business launch grants or financing to expand.
Select the 'grants' tick-box on the government's Finance and Support for Your Business website. You may also sort by how long you've been in business (which is important if you're solely looking for startup business grants), industry, staff count, and UK area.
Grants for small business startups
Depending on the industry you intend to operate, there are a variety of small business grants available.
Smart Grants from Innovate UK
Innovate UK is one of the Small business technology grants. Smart Grants from Innovate UK assist in the development of ambitious R&D technologies that have the potential to have a substantial impact on the UK economy.
Support from the government for businesses affected by the coronavirus (COVID-19)
Following the global impact of the coronavirus pandemic on both individuals and businesses, the UK government announced a package of relief measures aimed at business finance help for businesses that have been affected or have had to close.
Subsidy allowance for Covid-19 businesses: On March 4, 2021, the new domestic subsidy amount for COVID-19 business support awards went into effect. Prior to that date, applications are subject to the former rules. Three subsidy allowances apply to this scheme:
Allowance for small amounts of financial aid — subject to currency rates, you can receive up to £335,000 during three years.
Allowance for COVID-19 business grants – up to £1,600,000
COVID-19 business grant special allowance - if you've used up all of your financial assistance allowance and COVID-19 business grant allowance, you might be eligible for an additional allowance.
Seed Funding for Small Businesses (SEIS)
You've probably heard of this plan. It aids start-ups in raising funds for their venture. You can obtain up to £150,000 in total, including state aid provided in the three years leading up to the investment date.
Ascertain that you meet the requirements so that investors can claim and keep SEIS tax reliefs on their shares. If you do not meet these standards for three years after making an investment, the tax benefits will be withheld or revoked. The funds must be utilized within three years of the initial public offering.
Fiserv's Back2Business program
Fiserv's Back2Business program, which includes £10,000 subsidies for small, ethnically diverse firms, has debuted in the United Kingdom. Technology investment, premise re-design, and payroll are just a few of the funding services that funding might be used. Community partners such as the London Chamber of Commerce and Industry and its Black Business and Asian Business Associations will connect each grant recipient to local networking, support, and resources.
New Enterprise Allowance
If you wish to establish or grow a business, the New Enterprise Allowance provides you with coaching and funding. You must be over the age of 18 and one of the following to be eligible:
- Universal Credit, Job Seeker's Allowance, or Employment and Support Allowance are all options (or have a partner who does)
- be a single parent, sick or disabled, and on SSI
Your business proposal will need to be approved by your mentor. Following that, you may be eligible for a 26-week allowance of up to £1,274. If you wish to apply for the New Enterprise Allowance to help you start or grow your own business, talk to your Jobcentre Plus work coach.
Regional Growth Fund (RGF)
If your company needs less than £1 million in the capital, you may be able to apply for the Regional Growth Fund. RGF programs are administered by national or local organizations and can provide grants or loans to businesses that meet certain criteria.
Finally
Applying for small business grants can be difficult, but with the help of some basic measures, you can reduce your stress and (hopefully) boost your chances of receiving the funds you need to grow your company. When it comes to applying for small business grants, preparation is key. By analysing the business thoroughly, you'll have a clearer understanding of what you're hoping to do with this extra cash and how much you'll need.
