18th March 2020
Small Business Grant Scheme
The Local Economies Contingency Team is working at speed to operationalise the announcement in the budget that the government would provide £10,000 cash support to all businesses in receipt of Small Business Rates Relief in recognition of pressures they will face as a result of Covid-19.
What is HMG announcing?
- Providing £10,000 cash support to all business in receipt of Small Business Rates Relief (SBRR) (c.725k businesses) and Rural Rates Relief (c.3k).
- £2.2bn of funding for Local Authorities in England to support businesses that pay little or no business rates because of SBRR or Rural Rates Relief.
Why are they doing this?
The Government recognises that many small businesses pay little or no business rates because of Small Business Rates Relief (SBRR), but still face cost pressures at this time. To support those businesses, the government will provide £2.2bn of funding for Local Authorities in England.
Who will benefit?
- This funding will only benefit those with a premises. It excludes small businesses and the self-employed who do not occupy property (e.g. cleaners, handymen, freelancers).
- For a property with a rateable value of £12,000, this is one quarter of their rateable value, or comparable to 3 months of rent. Most properties that are eligible for SBRR will have a lower rateable value, and so this will represent an even greater proportion of their annual rent.
By how much?
This will provide £10,000 to around 700,000 business currently eligible for SBRR or Rural Rate Relief, to help meet their ongoing business costs.
Business Interruption Loan Scheme
A new Coronavirus Business Interruption Loan Scheme will launch in the week commencing 23 March, to support businesses to access bank lending and overdrafts.
The scheme will be delivered through commercial lenders, backed by the Government-owned British Business Bank. There are 40 accredited lenders able to offer the scheme, including all the major banks. The Scheme will support business loans and overdrafts of up to £5 million in value by providing a guarantee to the lender. The Government will not charge businesses for this guarantee. The scheme will also cover asset finance and invoice finance.
The decision on whether to offer finance is taken by each individual lender, not by government. Businesses remain responsible for repaying any borrowing that they take out.
In order to access the scheme, businesses should contact their finance provider, not the British Business Bank.
Full details of the scheme, including eligibility criteria, will be available on the British Business Bank website as soon as it is launched.
COVID-19 Corporate Financing Facility
To support larger firms, the Bank of England has announced a new lending facility to provide a quick and cost effective way to raise working capital via the purchase of short-term debt.
This will support companies which are fundamentally strong, but have been affected by a short-term funding squeeze, enabling them to continue financing their short-term liabilities. It will also support corporate finance markets overall and ease the supply of credit to all firms.
Further details, including on how to access this funding will follow in the coming days, and the scheme will be available from the week commencing 23 March.
Business Rates Relief
The government has announced a series of measures to support businesses affected by COVID-19, listed below. We are now waiting for confirmation on how these measures will be administered – once we receive this, we will provide further updates.
Extended Retail Rate Relief
If you are currently receiving the retail discount for your Business Rates bill, you will receive a revised bill with 100% relief shortly.
If your business occupies a property in the retail sector with a rateable value of £51,000 or more, or if your business occupies a property in the leisure or hospitality sectors you may also be eligible for the 100% discount on your business rates bill.
To support nurseries at this time, the Chancellor has also decided that they will also now be eligible for a business rates holiday for one year. That means non-local authority providers of childcare will pay no business rates in 2020-2021, from 1 April.
Small Business Grant
If your business is eligible for small business rate relief or rural rate relief, you are entitled to a one-off grant of £10,000.
Support for businesses that pay business rates
A grant of up to £25,000 will be provided to retail, hospitality and leisure businesses operating from smaller premises, with a rateable value of less than £51,000.
- For businesses in these sectors with a rateable value of under £15,000, they will receive a grant of £10,000.
- For businesses in these sectors with a rateable value of between £15,000 and £51,000, they will receive a grant of £25,000.
Any enquiries on eligibility for, or provision of, the reliefs should be directed to the relevant local authority. Guidance for local authorities on the business rates holiday and the expanded retail business rates discount will be published by 20 March.
Support for businesses that pay little or no business rates
The government will provide additional funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBBR). This will provide a one-off grant of £10,000 to businesses currently eligible for SBRR or rural rate relief, to help meet their ongoing business costs.
Funding for the scheme will be provided to local authorities by government in early April. Guidance for local authorities on the scheme will be provided shortly.
If you have any queries, please contact our Business Rates team via telephone or email.
South Oxfordshire District Council:
0845 300 5562
Vale of White Horse District Council:
0845 300 2839