In light of the recently imposed new national restrictions, many a self employed individual or small business owner is asking whether any additional support is now on offer.
The availability and extent of any grant based support varies by numerous factors including location, business sector, turnover, number of employees and whether the business is registered for PAYE and/or VAT – and the landscape of funding support seemingly changes with each new lockdown announcement. This makes it impossible for us to give tailored advice, so in the first instance, we suggest that you visit this UK Gov checker which enables you to input all of your specific circumstances and find out what support you can access.
In general terms however, the following support is available:
SECTOR SPECIFIC SUPPORT
There is sector specific support available only for those businesses in the leisure, hospitality and non-essential retail sectors and well as businesses who form part of the supply chain into those sectors which have been materially affected by recent lockdowns (The addition of these two latter categories is new for this particular funding round)
In Wales, the support is split into the following:
- £270m ERF Restrictions Business Fund will provide operating costs support for short term impact for up to 60,000 businesses that are materially impacted as a result of national restrictions. This is linked to the non-domestic rates system, with those eligible for Small Business Rates Relief (SBRR) eligible to receive a £3,000 payment and businesses with a rateable value of between £12,001 and £150,000 eligible for a £5,000 payment if impacted by the restrictions.
- £180m ERF Sector Specific Support is intended for businesses materially impacted by a greater than 60% loss of turnover as a result of the restrictions introduced on 4 December 2020 and ongoing into January 2021. For single employee business, the minimum grant of £2,500 and for SMEs (up to 249 employees), there is £1,500 per employee available, up to a maximum of 10 employees, representing £15,000 or for those employing more than 10. Applications open 11th January 2021 via Business Wales
- Continuation of the Discretionary Grants delivered by Local Authorities for those businesses who are below the VAT threshold and who are not on the non-domestic (NDR) i.e. do not have a premises. Note that the discretionary grant is not restricted to hospitality businesses but other affected businesses will have to show that they have been forced or required to close as a result of the national restrictions put in place during December 2020 OR estimate that the latest restrictions put in place will result in at least a 40% reduction in their turnover for December 2020 as compared to December 2019 (or September 2020 turnover if not trading in December 2019) The grant level for this strand is set at eligible costs of up to £2,000 per business – the scheme is now live on most Local Authority websites now.
In England, the support is as follows:
- The Local Restrictions Support Grants ((Closed) Addendum: Tier 4) supports businesses that have been required to close due to temporary local restrictions. Businesses that were open as usual and were then required to close due to local Tier 2, Tier 3 or Tier 4 restrictions may be eligible for a cash grant from their Local Council for each 14 day period they are closed. 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 for at least 14 days because of the restrictions
- 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. If your business has a property with a rateable value of £15,000 or less, you may be eligible for a cash grant of £667 for each 14 day period your business is closed. 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 £1,000 for each 14 day period your business is closed and if your business has a property with a rateable value of £51,000 or above, you may be eligible for a cash grant of £1,500 for each 14 day period your business is closed. Please visit your Local Council website to apply.
- The Additional Restrictions Grant (ARG) provides local councils with grant funding to support closed businesses that do not directly pay business rates as well as businesses that do not have to close but which are impacted. Local councils have the freedom to determine the eligibility criteria for these grants. However, we expect the funding to help those businesses which – while not legally forced to close – are nonetheless severely impacted by the restrictions e.g. businesses which supply the retail, hospitality, and leisure sectors, businesses in the events sector and businesses required to close but which do not pay business rates. Please visit your Local Council website to apply.
CORONAVIRUS JOB RETENTION SCHEME (CJRS)
The Coronavirus Job Retention Scheme (CJRS) has been extended until 30 April 2021 and at this stage, the claim levels remains at 80% of usual wages for the hours not worked. Note that all businesses who operate an online PAYE scheme are eligible to apply, even if they have not previously done so, although note that claims for any furlough days in December 2020 must be made by 14 January 2021 latest. Please get in touch if you would like us to assist with your furlough claim.
SELF EMPLOYMENT INCOME SUPPORT SCHEME (SEISS)
The Self Employment Income Support Scheme (SEISS) continues to operate with the third tranche closing for claims on Friday 29 January 2021. The grant is based on 80% of three months’ average trading profits, paid out in a single taxable instalment capped at £7,500, and will cover the period from 1 November to 29 January 2021. Unfortunately, we cannot assist with SEISS applications so if you are eligible, please be sure to apply before this date here. To make a claim for the third grant, you must (as previously) be self-employed or a member of a partnership – you cannot claim the grant if you trade through a limited company or a trust – plus you will need to have traded in both the tax years 2018 to 2019 and 2019 to 2020; in addition, you must:
- either be currently trading but are impacted by reduced business activity, capacity or demand, or have been previously trading but are temporarily unable to do so due to coronavirus
- declare that you intend to continue to trade, or restart trading, and that you reasonably believe that the impact on their business will cause a significant reduction in their trading profits
- only claim if the reduction in profits is caused by reduced business activity, capacity or demand, or inability to trade due to coronavirus. Reduction in profits due to increased costs (such as having to buy masks) does not make a business eligible for the third SEISS grant.
The application deadline for the various loan schemes – including the Bounce Back Loan Scheme, Coronavirus Business Interruption Loan Scheme, Future Fund and Coronavirus Large Business Interruption Loan Scheme – has been extended to the end of January 2021. In addition, the Bounce Back Loan Scheme rules now allow those businesses who borrowed less than their allowable maximum (i.e. the lower of £50,000 or less than 25% of their turnover) to top-up their existing loan, on the basis that some companies did not anticipate that the disruption to their business from the pandemic would continue for this long. Contact your bank directly if you wish to arrange a top up.
As national lockdown continues, further support may be announced – we will of course post further guidance to our blog as it becomes available.