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Small Business Grants Fund

Treasury written question – answered on 6th May 2020.

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Photo of Fleur Anderson Fleur Anderson Labour, Putney

To ask the Chancellor of the Exchequer, if he will extend the small business grant to all active businesses not eligible for business rate relief.

Photo of Kemi Badenoch Kemi Badenoch The Exchequer Secretary

The Small Business Grant Fund is designed to give additional financial support to those small businesses which are likely to face high fixed building-related costs, such as rent.

However, we are aware that many small businesses which are facing high fixed costs are finding themselves excluded from the existing grants schemes because of the way they interact with the current business rates system. Government has provided up to an additional £617m for Local Authorities in England to enable them to make grants payments to businesses in these circumstances. This funding will be used by Local Authorities to create a Discretionary Grants Fund.

Local Authorities are responsible for defining precise eligibility for these funds. However, it is our intention that the following businesses should be considered as a priority for these funds:

  • Businesses in shared offices;
  • Regular market traders who do not have their own business rates assessment;
  • B&Bs which pay Council Tax instead of business rates; and
  • Charity properties in receipt of charitable business rates relief which would otherwise have been eligible for Small Business Rates Relief or Rural Rate Relief.

Recipient businesses will also have to meet the following criteria:

  • They must be facing high fixed property-related costs;
  • They must be able to demonstrate that they have suffered a significant fall in income due to the Covid-19 crisis;
  • They must have fewer than 50 employees;
  • They must have been trading on or before 11th March.

Businesses will need to apply to their Local Authority in order to receive grants. Each Local Authority will need to create their own process, which may take some time. We encourage businesses to look out for their Local Authority’s version of this scheme, and to contact their Local Authority for more information in due course.

Small businesses which are not eligible for business grants should still be able to benefit from other elements of the Government’s unprecedented package of support for business, including:

  • An option to defer VAT payments by up to twelve months;
  • The Bounce Back Loan scheme, which will ensure that small and micro businesses can quickly access loans of up to £50,000 which are 100% guaranteed by the Government;
  • The Coronavirus Business Interruption Loan Scheme, now extended to cover all businesses including those which would be able to access commercial credit;
  • The Coronavirus Job Retention Scheme, to support businesses with their wage bill;
  • The Self-Employment Income Support Scheme, to provide support to the self-employed.

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