Covid-19 Financial Support for British Businesses
On the 7th January 2022, the UK government announced that it would be providing over £700 million of funding to businesses most affected by the Omicron variant of Covid-19.
This funding will be distributed to local councils throughout the country and is to be provided to businesses that have been most impacted by Covid-19 and the recent wave of the Omicron Variant.
The announcement of this latest funding scheme was announced by Business Secretary Kwasi Kwarteng
“All through the pandemic, we have stood by the side of businesses to ensure they are supported at every stage. The spread of the Omicron variant is presenting a new challenge, particularly for the hospitality and leisure sectors, so it is only right that we are stepping up with an urgent £1 billion support package”
What types of Businesses are Eligible?
Businesses working in the hospitality, leisure and accommodation sectors who have recently experienced a decline in customer traffic and cancellations have been advised that they will be able to apply for one-off cash grants of up to £6,000 per premises dependent on their rateable value:
- Businesses with a rateable value of £51,000 or above will be able to apply for £6,000
- Businesses with a rateable value between £15,000 and £51,000 will be able to apply for £4,000
- Businesses with a rateable value of £15,000 or below will be eligible to apply for £2,667
What Additional Funding Is Available?
In addition to these Omicron hospitality and leisure grants, local councils have also been provided with an additional £100 million for the Additional Restrictions Grant (ARG). These funds can be used at the discretion of the local authority to support other businesses, including those that supply the leisure and hospitality sectors as well as personal care services. The business secretary has also contacted local authorities who have more than 5% left from their previous ARG funding rounds, instructing them to disburse these remaining funds.
The grant funding forms part of a £1 billion business support package, which also includes
- £30 million for the Culture Recovery Fund
- £102 million for the Additional Restrictions Grant
- £154 Million of Barnett funding covering the targeted hospitality and leisure grants, ARG’s and Culture Recovery Fund
- Reimbursing eligible businesses for the cost of Statutory Sick Pay for Covid related absences
This new round of funding is just one of the many support packages that the British Government have put in place to help businesses with their recovery post-pandemic, including:
Business Rates Relief: Meaning that many businesses working in the hospitality and leisure sectors will see a 75% reduction in their business rates bill across the current financial year and a further 50% capped business rates relief for the next financial year.
VAT Reduction: VAT for hospitality and tourism has been reduced to 12.5% until the end of March 2022 to support approximately 150,000 businesses and protect over 2.4 million jobs.
Covid Additional Relief Fund: This is for businesses that have not previously received any business rate support.
Eviction Protection: Businesses who are behind on rent on their premises will be protected from eviction thanks to the moratorium that is in place until March 2022.
Recovery Loan Scheme: This provides access to finance for SME’s. You can find out more in our recent blog on the scheme here
Bounce Back Loan Repayment Flexibility: This allows borrowers to take the option of a 6 month repayment holiday, three 6 month interest-only periods or allows them to extend their loan to 10 years which in turn halves their monthly payments.
HMRC and Time to Pay: For businesses impacted by the Covid-19 pandemic, HMRC offers a time to pay system. The Chancellor has asked HMRC to offer businesses working in the hospitality and leisure sectors, the option of a short delay, and the opportunity to pay in instalments, which will be offered on a case by case basis.
Over the coming weeks, we will be exploring the effects of Covid-19 on British business and providing more information on all the funding that is currently available to businesses throughout the country.
To find out what support is available for your business, contact our business finance team today to discuss your options and how we can help you and your business access necessary funding post-pandemic.
T. 020 3857 3030