Earlier this month, Rishi Sunak announced the government’s 2021 Budget. In his live announcement, the Chancellor outlined the financial schemes this year to help businesses recover from the COVID-19 closures.
Many of the schemes introduced will replace those in 2021, or be an extension of them, so it may be that you will need to reapply for a new financial grant with your local council.
See a roundup of the most relevant kickstart grants or schemes available for small business owners in 2021 below.
Restart grants
Restart grants are available for non-essential retailers and businesses that have been affected by profit-losses during the pandemic. The grants are being issued ahead of the government’s lockdown-easing roadmap, which sees some of these non-essential businesses reopen on April 12th.
The grants are available from April 1st and are issued by local authorities. If you’re eligible for a restart grant, you could receive up to £6,000 as a one-off cash sum.
Businesses operating in the leisure, hospitality accommodation or personal care sector that will remain closed for a longer time-period could receive up to £18,000 as a one-off cash sum.
To see the full eligibility and apply through your local council, visit the Restart Grant government guide.
The Recovery Loan Scheme
The Recovery Loan Scheme will replace last year’s CBILS and BBS and is a range of loans from government-backed lenders. The loans are on offer to businesses of all sizes, and applications open on April 6th and run until the end of the year.
Business owners can borrow up to £10 million for any legitimate business purpose, and the government will guarantee 80% of the finance to the lender.
You can find out more about the Recovery Loan scheme here.
Furlough
The furlough scheme rolled out last year will be continued until the end of September this year, with the government paying employees’ salary up to 80%.
However, in July, employers will be asked to contribute towards the cost of your furloughed employee’s wages, with the government contributing 70%. This will increase to 20% in August, with the government contributing 60% until the scheme is phased out.
See more details on the changes to the furlough scheme.
Business rates relief
The Business Rates Holiday for non-essential retailers and the hospitality, personal care and leisure sector will be continued at 100% until the end of June. After June, the rates will be discounted by two-thirds up to the value of £2 million for closed businesses.
There is no need to apply for rate relief. Your local council should implement the discount automatically. However, if you think you’re not getting what you’re entitled to, you should contact your local council directly. Find out more about how to do this here.
Self-employment Income Support (SEISS)
The government has extended the self-employment income support scheme providing a fourth grant to those who have suffered profit losses under the pandemic.
The grant is set at 80% of 3 months trading profits, and it’s paid out to business owners in 1 single instalment, capped at £7,500.
See the full eligibility criteria and how to claim on the government guide.
VAT
VAT will remain at a reduced rate of 5% until the end of September. On October 1st, there will be a new rate of 12.5% introduced, which will last until March 31st 2022.
See more government guidance on VAT rates.
Alcohol duties
The Chancellor has frozen duties on all alcoholic drinks for the second year in a row to help the pubs and hospitality industry. The British Beer and Pub Association reported that this could save pub-goers £80 million and could safeguard 2,000 jobs.
All of the above schemes and grants were announced as part of the 2021 Budget. Small business owners should keep up to date with financial aid to help them on the road to recovery. You can see the full Budget transcript here.