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Important information about business grants

Find out about when you will get paid, monitoring of your information, and previous grant schemes.

The Government have provided a new grant available to business in hospitality, leisure and accommodation where they have been impacted by the rise in covid cases due to the Omicron variant.  

The following grants were available to businesses impacted by local and national restrictions and those who are now impacted by the Omicron varient:

  • Omicron Hospitality and Leisure Grant from 30 December 2021
  • Additional Restrictions Grant discretionary scheme for businesses not eligible to claim the above grants, based on eligibility criteria (ARG) this scheme closed on 31 March 2021.
  • Restart Grant from 1 April 2021 – now closed
  • Local Restriction Support Grant for Open businesses (LRSG Open) this is currently suspended due to the national lockdown, businesses who are now closed – now closed
  • Local Restriction Support Grant for Closed businesses, which includes business who are mandated to close, but are operating a take away or click and collect service (LRSG Closed) this scheme closes 31 March 2021 – now closed
  • Local Restriction Support Grant  for Sector businesses, which are closed since 23 March 2020 such as nightclubs (LRSG Sector) this scheme closes 31 March 2021 – now closed.
  • Christmas Support Grant for wet-led pubs (CSG), this scheme closed 28 February  2021 – now closed

When will I get paid?

We will aim to pay the funds into the nominated bank account as soon as possible on receipt of a fully completed application form and supporting evidence. 

Where a business is a limited company, you MUST provide the bank account details for the company and not provide a personal bank account. Payments will be delayed where personal bank details are provided.

What evidence do I have to provide?

The council reserves the right to request any evidence, explanation or proofs that it deems necessary and reasonable, in order to properly assess an applicant’s entitlement to a grant award. This condition applies at any time during or after the application process.

If an applicant fails to satisfy all reasonable requests made by the council, the council reserves the right to either not pay an award, or request the repayment of an award already paid. Any refusal to cooperate with the council will result in the rejection of the application and any grant payments already made, will be recalled.

Is the grant taxable?

Grant income received by a business is taxable. The Local Restrictions Support Grant will need to be included in your tax return. 

Only businesses which make an overall profit once grant income is included will be subject to tax.

Payments made to businesses before 5 April 2022 will fall into the 2021/22 tax year. Unincorporated businesses will be taxed when they receive the grant income.

What is Subsidy Allowance? 

The United Kingdom remains bound by its international commitments, including subsidy obligations set out in the Trade and Cooperation Agreement (TCA) with the EU. We have detailed below for reference the types of allowances. 

Please note you must provide any allowances received on the application form and provide any necessary documentation if requested by the Council. 

Small Amounts of Financial Assistance 

Grants may be paid in accordance with Article 364(4) of the TCA, which enables an applicant to receive up to a maximum level of subsidy without engaging Chapter 3 of the TCA. This allowance is up to 325,000 Special Drawing Rights, to a single economic actor over a rolling period of three fiscal years (the “Relevant Period”), which is the equivalent of £335,000 as at 2 March 20211. 

COVID-19 Business Grant Allowance

Where the Small Amounts of Financial Assistance Allowance has been reached or an applicant has elected not to receive a grant under this allowance, grants may be paid in compliance with the Principles set out in Article 366 of the TCA and in compliance with Article 364(3) of the TCA under the COVID-19 Business Grant Allowance (subsidies granted on a temporary basis to respond to a national or global economic emergency). For the purposes of the COVID-19 Business Grant Schemes, this allowance is £1,900,000 per single economic actor. This allowance includes any grants previously received under other COVID-19 Business Grant Schemes using the COVID-19 Business Grant Allowance and any State aid previously received under Section 3.1 of the European Commission’s Temporary Framework across any other UK scheme. This may be combined with the Small Amounts of Financial Assistance Allowance to equal £2,235,000 (subject to the exact amount applicable under the Small Amounts of Financial Assistance Allowance using the Special Drawing Right calculator, and any other support an applicant has received under the Small Amounts of Financial Assistance Allowance in the Relevant Period).

COVID-19 Business Grant Special Allowance 

Where an applicant has reached its limit under the Small Amounts of Financial Assistance Allowance and COVID-19 Business Grant Allowance, it may be able to access a further allowance of funding under the COVID-19 Business Grant Schemes of up to £10,000,000 per single economic actor, provided the following conditions are met:

  1. The Special Allowance covers only the applicant’s uncovered fixed costs incurred during the period between 1 March 2020 and the date of application, including such costs incurred in any part of that period (‘eligible period’); 
  2. Applicants must demonstrate a decline in turnover during the eligible period of at least 30% compared to the same period in 2019. The calculation of losses will be based on audited accounts or official statutory accounts filed at Companies House, or approved accounts submitted to HMRC which includes information on the applicant’s profit and loss; 
  3. ‘Uncovered fixed costs’ means fixed costs not otherwise covered by profit, insurance or other subsidies; 
  4. The grant payment must not exceed 70% of the applicant’s uncovered fixed costs, except for micro and small enterprises (for the purposes of this scheme defined as less than 50 employees and less than £9,000,000 of annual turnover and/or annual balance sheet), where the grant payment must not exceed 90% of the uncovered fixed costs; 16 
  5. Grant payments under this allowance must not exceed £10,000,000 per single economic actor. This allowance includes any subsidies previously received in accordance with Section 3.12 of the European Commission’s Temporary Framework or previously received under the COVID-19 Business Grant Schemes using this COVID-19 Business Grant Special Allowance; all figures used must be gross, that is, before any deduction of tax or other charge; 
  6. Grants provided under this allowance shall not be cumulated with other subsidies for the same costs.

For the avoidance of doubt, grants under the Small Amounts of Financial Assistance Allowance, the COVID-19 Business Grant Allowance and the COVID19 Business Grant Special Allowance may be combined for a potential total allowance of £12,235,000 (taking into account all grants previously received under the COVID-19 business grants schemes and subject to the exact amount applicable under the Small Amounts of Financial Assistance Allowance using the Special Drawing Right calculator and the three fiscal year period applicable to the Small Amounts of Financial Assistance Allowance).

What is State Aid?

The EU State aid rules no longer apply to subsidies granted in the UK following the end of the transition period, which ended on 31 December 2020. This does not impact the limited circumstances in which State aid rules still apply under the Withdrawal Agreement, specifically Article 10 of the Northern Ireland Protocol. However, in the vast majority of cases this will not apply. The United Kingdom 14 remains bound by its international commitments, including subsidy obligations set out in the Trade and Cooperation Agreement (TCA) with the EU. BEIS Guidance for public authorities explaining the subsidies chapter of the TCA, World Trade Organisation rules on subsidies, and other international commitments can be found here:

https://www.gov.uk/government/publications/complying-with-the-uksinternational-obligations-on-subsidy-control-guidance-for-public-authorities.

State Aid is any advantage granted by public authorities through state resources on a selective basis to any organisations that could potentially distort competition and trade in the European Union (EU).

The definition of State Aid is very broad because ‘an advantage’ can take many forms. It is anything which an undertaking (an organisation engaged in economic activity) could not get on the open market.

State Aid rules can (among other things) apply to the following:

  • grants
  • loans
  • tax breaks, including enhanced capital allowances
  • the use or sale of a state asset for free or at less than market price. 

The rules can apply to funding given to charities, public authorities and other non-profit making bodies where they are involved in commercial activities. 

How will you deal with fraud and error?

The Government will not accept deliberate manipulation and fraud, and any business caught falsifying their records to gain additional grant money will face prosecution and any funding issued will be subject to claw back, as may any grants paid in error.

The council will carry our pre and post-payment checks on all grant payments. 

How are grants monitored?

In order to monitor the outcomes and effectiveness of the scheme, East Riding of Yorkshire Council reserves the right to request any evidence, explanation or proofs that it deems necessary or reasonable. This is to satisfy the Department for Business, Energy and Industrial Strategy (BEIS) requirement that all grant recipients may be required to provide, on demand, all evidence and proofs to BIES as BEIS deems necessary. 

These conditions apply during and after the application process.

What support is the government offering businesses regarding my business rates bill? 

The Chancellor announced an extension to the Retail Relief Scheme from 1/4/21 to award Retail relief of 100% for eligible properties from 1/4/21 to 30/6/21, and  then relief of 66% from 1/7/21 to 31/3/22.

The Chancellor has announced an extension to the Retail Relief Scheme from 1/4/22 to award Retail relief of 50% for eligible properties

The Chancellor announced a number of measures to support businesses with effect from 1 April 2021.

As part of these additional support measures, the council has processed changes to the Retail Relief Scheme which means all retail, leisure and tourism properties will pay no business rates in 2020-21, regardless of their rateable value.

The existing Retail Relief Scheme previously covered retail properties only, with a rateable value up to £51,000, but the government has:

  • widened the Retail Relief scheme to include the leisure and tourism industry, including hotels, cafes, restaurants, nightclubs and gyms
  • removed the £51,000 rateable value ceiling level
  • decreed that children's nurseries occupied by providers on the Ofsted’s Early Years Register, and wholly or mainly used for the provision of the Early Years, will not have to pay business rates in 2020/21. There is no rateable value limit on the relief. 

 

All those businesses affected received a revised rates bill for nil.  All relief awards are subject to state aid 'de minimus' regulations.

The list below sets out the types of uses that the Government does not consider to be an eligible use for the purpose of this relief. 

Business premises that are being used for the provision of the following services to visiting members of the public:

  • Financial services (such as, banks, building societies, cash points, bureaux de change, payday lenders)
  • Medical services (such as, vets, dentists, doctors, osteopaths, chiropractors)
  • Professional services (such as, solicitors, accountants, insurance agents/Financial advisers)
  • Post Office sorting offices
  • Business premises that are not reasonably accessible to visiting members of the public. 

 

There is no rateable value cap on this relief for the financial year 2020/21 only.

What Previous Business Rates Grant schemes were available?

Previous Business Rates Grants

The government made three grants schemes available to help support businesses during this period. The funding was made available to help small, rural, retail, leisure and hospitality businesses with their ongoing business costs in recognition of the disruption caused by COVID-19. 

This grant scheme closed on 28 August 2020, no further applications are being accepted.

Previous Discretionary Grant Fund

The government made available a limited pot of money in the East Riding for a local discretionary grant fund to help businesses who supply the retail, leisure and hospitality sectors that have not been able to access other forms of support, that have suffered a significant loss of income during the lockdown and that have not qualified for other forms of financial support. 

This grant scheme is now closed, no further applications are being accepted.

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