Magee Gammon Loans/Grants

Loan and Grant information

We fully understand the difficulties that you may be facing in these uncertain times and we want to assure you that our team are here to help. To find out how we can support you, please speak to one of our team today.

The information included on this page is our interpretation of what has been published at this time, this may change in the future as further information and clarity of the information already published becomes clearer. We will be updating this page regularly.

 


Latest update – 6th December 2021

Six-month extension for COVID-19 recovery loan scheme

Chancellor Rishi Sunak has extended a coronavirus loan guarantee scheme in a bid to protect UK businesses into next year.

Sunak used his Autumn Budget speech to announce a six-month extension of the recovery loan scheme, which had been due to end on 31 December 2021 but is now due to close on 30 June 2022.

The scheme was launched on 6 April 2021 as a bridge between the more generous coronavirus loan schemes which were winding down, and more normal credit conditions.

It provides credit worth up to £10 million per business and up to £30m across a group, with loans available to help fund growth and investment, or manage cashflow.

At the end of October 2021, a total of £822.8m had been borrowed by 5,137 UK businesses since the scheme was launched at the start of the 2021/22 tax year.

About 1,000 more firms have been told they can borrow up to £200m but have yet to tap into it, possibly because the terms are less generous than previous pandemic loan schemes.

Catherine Lewis La Torre, chief executive at the British Business Bank, said:

“A six-month extension to the recovery loan scheme will provide valuable support for smaller businesses as they look beyond the pandemic and towards the opportunities available to them in the recovery.”

We can check if your business is eligible.


Updated – 22nd June 2021

Check if you’re eligible for the coronavirus Additional Restrictions Grant

The Additional Restrictions Grant (ARG) supports businesses that are not covered by other grant schemes or where additional funding is needed.

Local councils have the freedom to determine the eligibility criteria for these grants. However, the government expect the funding to help businesses that are severely impacted by the restrictions.

Local councils are encouraged to support:

See: Check if you’re eligible for the coronavirus Additional Restrictions Grant – GOV.UK (www.gov.uk)


Updated – 19th April 2021

Recovery Loan Scheme update

The Recovery Loan Scheme supports access to finance for UK businesses as they grow and recover from the disruption of the COVID-19 pandemic. Up to £10 million is available per business. The actual amount offered, and the terms are at the discretion of participating lenders.

The government guarantees 80% of the finance to the lender. As the borrower, you are always 100% liable for the debt. The scheme is open until 31 December 2021, subject to review. Loans are available through a network of accredited lenders, listed on the British Business Bank’s website.

Eligibility

You can apply for a loan if your business:

You need to show that your business:

Business that received support under the earlier COVID-19 guaranteed loan schemes are still eligible to access finance under this scheme if they meet all other eligibility criteria.

Who cannot apply

Businesses from any sector can apply, except:

What you can get

No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.

How long the loan is for

The maximum length of the facility depends on the type of finance you apply for and will be:

How to apply

Find a lender accredited to offer Recovery Loans from the list on the British Business Bank website:

Recovery Loan Scheme: current accredited lenders – British Business Bank (british-business-bank.co.uk)


Updated – 13th April 2021

Coronavirus Restart Grant

Businesses in the non-essential retail, hospitality, leisure, personal care and accommodation sectors can now access one-off cash grants of up to £18,000 from their local council.

The Restart Grant scheme opened nationally on 1 April 2021 and is now being rolled out by local authorities across England.

Eligible businesses will be paid:

Your business may be eligible if you are:

However, you may not be eligible if your business:

It is down to each local councils’ discretion, as to whether a business meets the eligibility criteria for this grant scheme.

To apply you will need to find your relevant local authority by clicking here.

If you need assistance with claiming this grant or you are unsure of your eligibility, please speak to our team. 


Updated – 31st March 2021

New recovery loan scheme replaces previous COVID-19 loans

All UK businesses can access loans and other finance of up to £10 million each, following the end of COVID-19 loan schemes.

Both business interruption loans – for large firms and SMEs – and bounce-back loans officially closed on 31 March 2021. Firms that received financial support from any of those schemes can apply for the recovery loan scheme from 6 April 2021.

UK businesses of any size can apply for a loan or overdraft of between £25,001 and £10m until the end of 2021, with interest and fees applying.

Invoice finance and asset finance worth between £1,000 and £10m per business is also available over the same period. The Government hopes the scheme will help businesses recover and grow when lockdown restrictions begin to ease.

Suren Thiru, head of economics at the British Chambers of Commerce, said:

“Accessing finance remains crucial to the lifeblood of a business and so the announcement of a new loan scheme is welcome. “The acid test for the new scheme will be whether it is able to support the recovery by getting credit flowing to the firms who most need it. “The scheme must be right from day one to ensure that businesses and banks can use it to help SMEs return to growth.”

All but businesses deemed most high-risk are currently set to reopen on 17 May 2021.

Get in touch to discuss COVID-19 support.


Updated – 8th March 2021

The Recovery Loan Scheme

The government have already announced a longer repayment period for “Bounce-back” and CBIL loans. From 6 April 2021 a new Recovery Loan Scheme will provide lenders with a guarantee of 80% on eligible loans between £25,000 and £10 million to give them confidence in continuing to provide finance to UK businesses. The scheme will be open to all businesses, including those who have already received support under the existing COVID-19 guaranteed loan schemes.

The Recovery Loan Scheme ensures businesses of any size can continue to access loans and other kinds of finance up to £10 million per business once the existing COVID-19 loan schemes close, providing support as businesses recover and grow following the disruption of the pandemic and the end of the transition period.

Once received, the finance can be used for any legitimate business purpose, including growth and investment. The government guarantees 80% of the finance to the lender to ensure they continue to have the confidence to lend to businesses.

The scheme launches on 6 April and is open until 31 December, subject to review. Loans will be available through a network of accredited lenders, whose names will be made public in due course.

What type of finance is available?

Finance terms are up to six years for term loans and asset finance facilities. For overdrafts and invoice finance facilities, terms will be up to three years. No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.

Eligibility

You will be able to apply for a loan if your business:

You will need to show that your business:

Businesses that have received support under the existing COVID-19 guaranteed loan schemes will still be eligible to access finance under this scheme if they meet all other eligibility criteria.

How to apply

The scheme will launch on 6 April 2021. Further details on how to apply and details of accredited lenders will be released in due course.

See:  https://www.gov.uk/guidance/recovery-loan-scheme


New grants for high street businesses and hospitality sector

Businesses forced to close due to the Coronavirus lockdown will be eligible to apply for grants of up to £18,000 depending upon the rateable value of their business premises. Pubs, restaurants, hotels, gyms and hairdressers will be eligible for a grant of up to £18,000 per premises whilst non-essential retail businesses will be eligible to apply for a grant up to a maximum of £6,000.

The grants are intended to be a contribution towards the fixed costs of the business during the period that they have been unable to trade normally. Staff costs continue to be covered by the CJRS furlough scheme.

The government will also continue to provide eligible retail, hospitality and leisure properties in England with 100% business rates relief from 1 April 2021 to 30 June 2021. This will be followed by 66% business rates relief for the period from 1 July 2021 to 31 March 2022, capped at £2 million per business for properties that were required to be closed on 5 January 2021.

See: https://www.bighospitality.co.uk/Article/2021/03/01/Budget-to-include-5bn-restart-grant-scheme-for-hospitality-and-High-Street-businesses


Updated – 8th February 2021

COVID-19 Bounce Back Loan repayment period extended

The Government has announced changes to the Bounce Back Loan Scheme (BBLS) available to small businesses in the UK that will give companies longer to repay what they have borrowed.

Around 1.4 million small and medium-sized businesses have taken out a loan since they were introduced last year, amounting to around £45 billion of financial support.

Under the current scheme, firms get interest-free loans for the first year. However, many businesses that took out a loan last year will have to begin repaying the money lent to them in May.

With large parts of the country likely to remain in lockdown for many weeks to come, the Government is making changes to its existing ‘Pay as you Grow’ (PAYG) initiative that are designed to give small businesses greater support to repay their loan, without it adversely affecting their recovery.

Under the new arrangements, businesses will have the option to:

The Treasury has said that the PAYG scheme gives borrowers the flexibility to tailor their repayment schedule to meet the needs of their business.

The initiative will now be available to all borrowers from their first repayment, rather than after six repayments have been made.

This will mean that businesses can choose to make no payments on their loans until 18 months after they originally took them out.

Applying for a Bounce Back Loan 

Although the Government is already looking at how existing borrowers can repay the money that they have borrowed, the BBLS remains open to new claims until the end of March.

It enables small and medium-sized businesses to borrow between £2,000 and up to 25 per cent of their turnover (capped at £50,000).

The BBLS is 100 per cent backed by the Government, which means that only minimal checks are required by lenders. Following the first interest-free year, a fixed interest rate of 2.5 per cent a year applies.

If you already have a loan but borrowed less than you were entitled to, you can still top up your existing loan to your maximum amount.

Businesses that intend to use the BBLS must make an application or top up an existing loan by the 31 March 2021.

If you haven’t yet made an application for the scheme or would like help with the PAYG scheme, please contact us.


Updated – 5th January 2021

Chancellor announces grants worth up to £9,000 for businesses in the retail, hospitality and leisure sectors

The Chancellor, Rishi Sunak, has announced a package of one-off grants worth between £4,000 and £9,000 for businesses in the retail, hospitality and leisure sectors, following the announcement of a nationwide lockdown in England lasting until at least mid-February.

The new scheme will be accessed through local authorities and offers funding based on the rateable value of a closed business’s premises:

This funding comes in addition to the existing Government business support schemes, including grants of up to £3,000 a month for closed businesses.

The Chancellor has also announced a further £594 million for local authorities and the devolved administrations to support businesses that are not eligible for the new grants. The devolved administrations will additionally receive equivalent funding to the main grants to distribute as they see fit.

The Chancellor said: “The new strain of the virus presents us all with a huge challenge – and whilst the vaccine is being rolled out, we have needed to tighten restrictions further.

“Throughout the pandemic we’ve taken swift action to protect lives and livelihoods and today we’re announcing a further cash injection to support businesses and jobs until the spring.

“This will help businesses to get through the months ahead – and crucially it will help sustain jobs, so workers can be ready to return when they are able to reopen.”

Visit this page to keep updated with the latest information support available to businesses during the pandemic.


Updated – 8th December 2020

England – Local restriction support grant (for open businesses)

The Local Restrictions Support Grant (LRSG (Open)) supports businesses that have been severely impacted due to temporary local restrictions.

Businesses that have not had to close, but which have been severely impacted due to local tier 2 or tier 3 restrictions, may be eligible for LRSG (Open).

Eligible businesses may be entitled to a cash grant from their local council for each 14-day period under local restrictions.

Local councils have the discretion to provide grant funding for businesses under this scheme. They will use their discretion in identifying the right businesses to receive this funding, based on their application process.

See: https://www.gov.uk/guidance/check-if-youre-eligible-for-the-coronavirus-local-restrictions-support-grant-for-open-businesses?utm_source=edc153fa-e3a8-448d-b45f-60a63a9e462e&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 3rd November 2020

Government-backed loan schemes

Businesses had already been given an additional month to make an application for the Bounce Back Loan, Coronavirus Business Interruption Loan, Coronavirus Large Business Interruption Loan and Future Fund schemes, allowing them to submit by 30 November 2020.

However, in recognition of the additional financial support that some businesses may require, the Government will now extend the loan application window until 31 January 2021. 

Businesses that wish to make an application are encouraged to begin applications soon to ensure they have sufficient time to prepare and submit the required information.

To help businesses prepare for the changes resulting from national lockdown in England, the Government has produced a helpful factsheet.

Click here to download the latest factsheet

If you require support with any of the schemes recently announced or outlined in this update, please contact us.


Updated – 2nd November 2020

Business Grants

Businesses that are required to close under the new England-wide restrictions and which are in the business rates system will be able to claim grants of between £667 and £1,500 for each two-week period they are required to remain closed.

The arrangements are the same as those in place for businesses in areas of ‘Very High’ (Tier Three) Coronavirus restrictions through the Local Restrictions Support Grant.

The new grants will pay £667, £1,000 or £1,500 for each two-week period a business is required to shut.

Businesses with rateable values of £15,000 or less will receive £667, those with rateable values of £15,000 to £51,000 will receive £1,000 and those with rateable values of more than £51,000 will receive £1,500.

The scheme will be administered by Local Authorities, with £1.1 billion of funding being distributed on the basis of £20 per head to help them support businesses more broadly.

This scheme applies to England only. However, the Devolved Administrations will receive equivalent funding to distribute as they see fit.


Updated – 26th October 2020

Business Grants

The Government is providing additional funding to allow Local Authorities (LAs) to support businesses in high-alert (tier 2) level areas, which are not legally closed but that have been severely impacted by the restrictions on socialising.

The cash grants, worth up to £2,100 per month, are primarily aimed at businesses in the hospitality, accommodation and leisure sector.

The amount of funding received by each LA will, therefore, be based on the number of hospitality, hotel, B&B, and leisure businesses in each area.

As a guide, LAs will receive a funding amount that will be the equivalent of:

It will be down to the discretion of each LA to determine which businesses are eligible for grant funding and what level of funding to allocate to each business.

LAs will also receive an additional five per cent top-up to cover other businesses that might be affected by the local restrictions, but which do not fit into these categories.

Businesses in Very High alert level areas will qualify for greater support of up to £3,000/month whether closed or open.

These new grants will be available retrospectively for areas who have already been subject to previous local restrictions and backdated, in some cases, to August.


Updated – 28th September 2020

Bounce back loans – flexibility given to pay back amounts borrowed

More than a million businesses who took out a Bounce Back Loan will get more repayment time through a new Pay as You Grow flexible repayment system.

This includes extending the length of the loan from six years to ten, which will cut monthly repayments by nearly half. Interest-only periods of up to six months and payment holidays will also be available to businesses.

The Government also intends to give Coronavirus Business Interruption Loan Scheme lenders the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan.

The chancellor also announced an extension in applications for the government’s coronavirus loan schemes until the end of November.

Further guidance will be issued in due course.

See: https://www.gov.uk/government/news/chancellor-outlines-winter-economy-plan


Updated – 21st September 2020

Government to launch new local lockdown grants

Businesses that are required to shut due to local lockdowns could be entitled to claim up to £1,500 in grant funding every three weeks for each premises that is closed.

The new grant funding has been created to support those businesses that are adversely affected by local restrictions, which are being imposed in areas with high incidences of the Coronavirus.

Under the new scheme:

Unfortunately, any businesses still closed at a national level, such as nightclubs, will not be eligible for this funding.

The new grants will be delivered by local authorities, who will be responsible for distributing the grants to businesses in circumstances where they are closed due to local interventions. Local authorities are being given the discretion to determine additional eligibility criteria should it be deemed necessary.

These new grants can be used alongside other support, but as with other COVID grants funding from this new initiative will be treated as taxable income.

Further details of this new grant are yet to be published by either the Government or local authorities. We will try and bring you updates on this new scheme as and when they emerge.


CBILS ends on 30th September 2020

The Coronavirus Business Interruption Loan Scheme (CBILS) has offered important financial support to thousands of businesses across the UK – but it is due to end this month.

Although the deadline for accredited lenders to review applications was recently extended until 30th November 2020, businesses wishing to receive funding via the CBILS must have submitted their applications by 30th September 2020.

This means that time is running out to benefit from this loan, which offers no interest for the first 12 months, no upfront fees and funding facilities of up to £5 million.

If you have an existing Bounce Back Loan then you may still be eligible for a larger CBILS loan providing the new loan is used to consolidate the previous loan.

Please be aware that when using the CBILS, your business remains liable for the full loan amount – CBILS only provides a guarantee to the lender, not the business that receives funding.

To find out how we can help you take full advantage of the CBILS and support your application, please speak to our team.


Updated – 01 September 2020

Coronavirus Business Interruption Loan Scheme expanded to more businesses

Following a change in EU state aid rules, the Government has announced that it will expand the Coronavirus Business Interruption Loan Scheme (CBILS) to certain businesses classed as “undertakings in difficulty” – those with large losses and debts. The UK remains subject to EU state aid rules during the Brexit transition period.

The change means that businesses in this position with fewer than 50 employees and a turnover below £9 million can apply for a loan under the scheme.

CBILS was announced by the Chancellor during the Budget in March and enables businesses with a turnover of up to £45 million to borrow between £1,000 and £5 million, with the Government meeting the cost of interest for the first 12 months.

To date, more than 57,000 businesses have benefited from £12.6 billion in support from CBILS.

Chris Wilford, Head of Financial Services Policy at the CBI, said: “This is an important step that will help more businesses get the critical support they need. These eligibility hurdles have been a real stumbling block for many firms across the UK throughout the crisis. These were put in place to avoid governments bailing out failing companies, but those rules were established in normal times.

“They have had a real impact on the ability of some high-growth firms and those with more complex structures being able to access the loan schemes. More jobs and livelihoods will now be saved.”

Link: More businesses set to benefit from government loan scheme


Updated – 3rd August 2020

England – new grants to boost recovery of small businesses

Thousands of smaller businesses in England are set to benefit from £20 million of new government funding to help them recover from the effects of the coronavirus pandemic, the Minister for Regional Growth and Local Government has announced.

Small and medium sized businesses will have access to grants of between £1,000 – £5,000 to help them access new technology and other equipment as well as professional, legal, financial or other advice to help them get back on track.

The support will be fully funded by the Government with no obligation for businesses to contribute financially and the support will be fully funded by the government from the England European Regional Development Fund and distributed through local enterprise partnerships (LEP) Growth Hubs, embedded in local areas across England.

LEPs are voluntary partnerships between local authorities and businesses, set up in 2011 by the Department for Business, Innovation and Skills to help determine local economic priorities and lead economic growth and job creation within the local area.

Activities supported through the £20 million can include:

We will provide further details on how to apply for these grants in due course.

Please see:

https://www.gov.uk/government/news/20-million-in-new-grants-to-boost-recovery-of-small-businesses?utm_source=d73de287-c359-4e20-b0ee-3f50952053fd&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 20th June 2020

Dairy response fund – England

The Dairy Response Fund 2020 provides support to eligible dairy farmers in England who produce cows’ milk. They can apply for a one-off payment. A handbook was released 18 June 2020.

The Dairy Response Fund is now open for eligible farmers to apply for a single payment from the fund.

See: https://www.gov.uk/government/publications/dairy-response-fund-2020?utm_source=09cd74b9-1b6d-44f0-8092-3b9a9cf6e474&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 19th June 2020

Apply for the food charities grant fund

Apply for a grant of up to £100,000 for your charity helping people affected by coronavirus (COVID-19).

If you run a front-line food aid charity in England, you can apply for a grant of up to £100,000 to help you continue to provide food to the vulnerable. You can apply for funding as a group of charities to meet the criteria for applications.

The Department for Environment, Food and Rural Affairs (Defra) will assess applications to the fund in the order they are submitted.

See: https://www.gov.uk/guidance/coronavirus-covid-19-apply-for-the-food-charities-grant-fund?utm_source=f1e9a5e3-dc25-49bc-96ee-e903d92642af&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 10th June 2020

Apply for the coronavirus local authority discretionary grants fund – England

The Discretionary Grant Fund supports small and micro businesses that are not eligible for other grant schemes opened on the 8 June.

Small and micro businesses with fixed property costs that are not eligible for the Small Business Grant Fund or the Retail, Hospitality and Leisure Grant Fund may be eligible for the Discretionary Grants Scheme.

What you get

You can get a grant of £25,000, £10,000 or any amount under £10,000.

Eligibility

You may be eligible if your business:

You will need to show that your business has suffered a significant fall in income due to coronavirus.

The Government has asked local councils to prioritise businesses such as:

Local councils have discretion about how to prioritise this funding. Please check with your council for details of their scheme.

You cannot apply if your business is in administration, insolvent or has received a striking-off notice.

If you are already claiming funding

You cannot apply if you are already claiming under another government grant scheme, such as:

Businesses that apply for the discretionary grants scheme can still apply for coronavirus-related loans if they are eligible.

You are still eligible if you have applied for the Coronavirus Job Retention Scheme or the Self-Employed Income Support Scheme.

If you already get state aid

The discretionary grants fund counts towards state aid.

Payments of £10,000 or less count towards the total de minimis state aid you are allowed to get over a 3-year period – €200,000. If you have reached that threshold, you may still be eligible for funding under the COVID-19 Temporary Framework.

Payments of £25,000 count as state aid under the COVID-19 Temporary Framework. The limit for the framework is €800,000.

Your local council will ask you to complete a declaration confirming that:

To find your local council see: https://www.gov.uk/find-local-council

Full report see:

https://www.gov.uk/guidance/apply-for-the-coronavirus-local-authority-discretionary-grants-fund?utm_source=281bab0e-92ec-4a01-ab95-81f8181c1364&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Government help and support if your business is affected by coronavirus (covid-19)

Watch videos and register for the free webinars to learn more about the support available to help you deal with the economic impacts of coronavirus.

See: https://www.gov.uk/guidance/help-and-support-if-your-business-is-affected-by-coronavirus-covid-19?utm_source=cb5adab3-5b2b-401f-94b8-78e3fd6779a7&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Business loan scheme statistics

HM Treasury has released management information about the Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS), Bounce Back Loan Scheme (BBLS) and Future Fund Scheme.

See:

https://www.gov.uk/government/collections/hm-treasury-coronavirus-covid-19-business-loan-scheme-statistics?utm_source=40dce93e-df4b-4575-a362-fea625208398&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 4th May 2020

Bounce Back Loan Scheme (BBLS) – update

Chancellor Rishi Sunak has written to accredited lenders about how the Government wants BBLS to be run. He makes the point that as a 100% guaranteed loan scheme, the price of BBLS is critical to its success and that the loans need to ensure that these loans are affordable and accessible.

He has come to the decision that the interest rate should be set at 2.5%.

Interaction between BBLS and the Coronavirus Business Interruption Loan Scheme (CBILS)

Businesses will be able to borrow up to £50,000 under BBLS, capped at 25% of turnover. In order to ensure that businesses have a clear understanding of the support available to them under the loan guarantee schemes, the minimum facility size for term loans and overdrafts under CBILS will increase to £50,001 to avoid any risk of confusion or overlap. Any customer with a CBILS loan or overdraft of £50,000 or less will be able to switch that facility to a BBLS loan should they choose to do so over the next few months. This change to the minimum facility size will not apply to asset finance and invoice finance CBILS facilities.

Treasury Direction made by the Chancellor under Sections 71 and 76 of the Coronavirus Act 2020

The Government has released the Coronavirus Act 2020 Functions of Her Majesty’s Revenue and Customs (Self-Employment Income Support Scheme) Direction.

It sets out that HMRC are responsible for the payment and management of amounts to be paid under the Self-Employment Income Support Scheme, as set out in the Schedule to the Direction.

The Direction sets out the legal framework for the Scheme.

Government announcement:  https://www.gov.uk/government/publications/treasury-direction-made-by-the-chancellor-under-sections-71-and-76-of-the-coronavirus-act-2020?utm_source=40e61b90-3990-4bfb-bc04-5e6e39c928f6&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


How to apply for a Business Bounce Back Loan (BBBL)

The Bounce Back Loan scheme helps small and medium-sized businesses to borrow between £2,000 and £50,000.

The government guarantees 100% of the loan and there will not be any fees or interest to pay for the first 12 months.

Loan terms will be up to 6 years. No repayments will be due during the first 12 months. The government will work with lenders to agree a low rate of interest for the remaining period of the loan.

The scheme will be delivered through a network of accredited lenders.

Guidance on how to apply is given on the British Business Bank Website: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/for-businesses-and-advisors/

Actions required:

  1. Find an accredited lender – there is a link on the above page;
  2. Approach them, ideally via their website;
  3. Complete a short application form which self certifies that your business is eligible for a loan under BBLS;
  4. If eligible you will need to complete the Banks Anti-Money laundering, fraud and Know Your Client checks;
  5. The lender makes a decision

Talk to us if you need assistance in applying for a BBBL we will do our best to help.

Who is eligible:

Your business must be able to self‑declare to the lender that it:

Note: The above is not an exhaustive list – see The British Business Bank for more information.

Bounce Back Loans are available to businesses in all sectorsexcept the following:


The Coronavirus Business Interruption Loan Scheme (CBILS) Update

This week seven of the largest lenders to UK SMEs have written an open letter stating a key change to the CBILS application process:

“Following the changes to the scheme announced today lenders will only ask businesses for information and data they might reasonably be able to provide at speed and we will not require the provision of forward-looking financial information or business plans from businesses applying for CBILS-backed lending, relying instead on our own information to assess credit and business viability.

https://www.ukfinance.org.uk/press/press-releases/uk-finance-issues-joint-statement-behalf-seven-largest-sme-lenders

This means that business owners applying to these seven banks (Barclays Bank UK, Danske Bank, HSBC, Lloyds Bank, NatWest, Santander and Virgin Money) no longer need to prepare a cash flow and business plan when applying to CBILS. This dramatically reduces the efforts required to put an application together.

Despite it now being a simpler process to apply for CBILS financing, a business owner should consider if taking on debt at this time is the right thing to do.  To help make this decision preparing a forecast may be a very helpful tool to see how the cash position changes under different assumptions and scenarios.

This announcement appears to have arisen following a Prudential Regulatory Authority (PRA) announcement at the start of this week which requested lenders to consider the following in respect to CBILS:

“The performance of the business prior to the Covid-19 outbreak; a view of how the loan will be repaid in due course, relying on judgement in the absence of financial forecast information; and the general prospects for the sector in which the business operates once the effects of the pandemic have receded.”

See: https://www.bankofengland.co.uk/prudential-regulation/publication/2020/statement-on-the-regulatory-treatment-of-the-uk-cbils-and-the-uk-clbils


R&D Tax Credits and CBILS

R&D Tax Credits and CBILS are classed as state aid.  Under state aid rules a business is only able to receive one form of state aid for a project.

HMRC have issued the following wording on this:

Are new Government support schemes introduced in response to the Coronavirus, such as CBILs, State aids or subsidies? Will they affect a company’s ability to make a claim under the SME scheme?

The Government has notified CBILS as a State aid under the European Commission’s new Temporary Framework for COVID-19. The measure is a fully notified aid, so the restriction on receipt of other State aid (s1138(1)(a) CTA 2009) potentially applies, if the CBILS relates specifically to the company’s R&D expenditure [on a project] rather than being intended more generally to support the company. This will depend on the facts. We will be monitoring the application of this rule and welcome feedback.

See: https://www.tax.org.uk/sites/default/files/200402%20HMRC%20Covid-19%20R%26D%20Update.pdf

This appears to state that if a CBIL is received by a business to help finance a specific project then that project is not eligible for future R&D tax credits (or at least SME R&D tax credits). It may still be eligible for RDEC.

However, if the CBIL is used for general business purposes (which seems more likely in most cases) then a project receiving R&D tax credits should still be eligible to receive them in the future.

It should be noted that HMRC have said they will be monitoring claims as they come which shows the answer is not black and white and further guidance is likely to be produced in due course.

Please talk to us about R&D we have helped several clients with these sorts of claims.


Small Business Discretionary Grant Payments

Top-up to local business grant funds scheme 

The Government has announced a discretionary fund has been set up to accommodate certain small businesses previously outside the scope of the business grant funds scheme.

The Business Secretary Alok Sharma and Minister for Regional Growth and Local Government, Simon Clarke spoke to local authorities in England yesterday to set out that up to £617 million would be made available.

This is an additional 5% uplift to the £12.33 billion funding previously announced for the Small Business Grants Fund (SBGF) and the Retail, Hospitality and Leisure Grants Fund (RHLGF), so up to £617 million. The Government will confirm week commencing 4 May the exact amount for each local authority.

This additional fund is aimed at small businesses with ongoing fixed property-related costs. The Government are asking local authorities to:

Prioritise businesses in shared spaces, regular market traders, small charity properties that would meet the criteria for Small Business Rates Relief, and bed and breakfasts that pay council tax rather than business rates. But local authorities may choose to make payments to other businesses based on local economic need. The allocation of funding will be at the discretion of local authorities.

To be eligible:

There will be three levels of grant payments. The maximum will be £25,000. There will also be grants of £10,000. Local authorities will have discretion to make payments of any amount under £10,000. It will be for councils to adapt this approach to local circumstances.

Further guidance for local authorities will be set out shortly.

See: https://www.gov.uk/government/news/top-up-to-local-business-grant-funds-scheme?utm_source=c711a024-400a-41c6-a2b9-1a103a62ddaa&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate


Updated – 28th April 2020

BBLS Guidance – Bounce Back Loans scheme for small businesses

The Chancellor has announced a new loans measure, known as the Bounce Back Loans Scheme (BBLS), which will allow small businesses to borrow up to 25 per cent of their turnover, up to a maximum of £50,000.

The BBLS will be 100% backed by a Government guarantee, unlike the Coronavirus Business Interruption Loan scheme (CBILS) and will offer an interest-free period for 12 months.

Businesses will be able to apply online via a short and simple two-page self-certification form and because the loan is entirely Government-backed it is hoped that lenders will have the confidence to offer finance without the lengthy and complex red tape associated with CBILS and other loan schemes.

Importantly, firms applying for the new loans will only have to prove that they were viable in the past before the crisis, not that they will remain viable after the crisis. This future viability criteria been a major issue with CBILS.

There remains some concern that banks will still wish to assess the latest financials through a ‘cash available to service debt’ calculation. Where there isn’t sufficient cash to service the debt then there are fears that the loan may still not be granted despite the Government guarantee. Further clarification is expected soon.

The scheme has been designed specifically for small firms, including sole traders, that require ‘vital cash injections’ to help them operate during these challenging times. It will launch for applications from 9am on Monday 4 May and the loans will be provided through a network of accredited lenders.

The Government said that loans will be “advanced as quickly as possible” and that they will “agree a low standardised level of interest for the remaining period of the loan.”

We will keep you up to date on the application process once more is known.


Updated – 15th April 2020

Accounting for grant payments

Thousands of businesses hope to make use of the various grant payments being made available by the Government and local authorities in response to the Coronavirus pandemic.

However, those in receipt of the new funding will need to make sure it is properly accounted for, which raises the question, how do you account for grant income?

The first and most important point to consider in regards to grant income is whether the income really is a grant or whether it is instead a loan or some other form of financing.

The simple definition is that grant income is income received by you or your company for which you do not have to provide anything in return.

Although you may be required to report your use of the grant or be limited in how it is spent, you will not have to make any form for repayment or reparation, such as the provision of goods or services.

If the grant is for expenditure that you would normally record in the profit and loss account, the grant income is reflected as income in your profit and loss account.

Where a grant relates to specific equipment or another fixed asset then the grant income is deferred and should be released to the profit and loss account to match with the depreciation of the grant purchased asset.

You’re meant to account for the income when it becomes receivable, in the case of the Small Business Grants Fund and Retail, Hospitality and Leisure Grant Fund on the 20 March, not when it is received. This may mean that those with March year-end accounts may need to check how the income is reported.

Corporation Tax 

As grants are generally considered to be a taxable form of income, they can be the taxed the same as any other forms of income, such as money earned through trade, via Corporation Tax.

Where a grant is for expenditure that appears in your profit and loss account and you can defer the grant income, such as through the acquisition of a fixed asset, then you may not have a tax liability on the income as it will be matched with its intended expenditure (i.e. expenditure will cancel out income in your accounts).

In the case of the latest Government Covid-19 grants, it is most likely that you will have to pay Corporation Tax as they are not linked to the acquisition of an asset and cannot be deferred. It is therefore important that you account for this income accurately so that you pay the correct amount of tax in future.

VAT

Grant income is outside the scope of VAT, therefore no VAT is payable when you receive a grant, but you may be able to reclaim VAT from any asset paid for via a grant, as long as it is within the ‘normal’ VAT rules.

Complexity

Many businesses may not have used grant funding before and it is easy to make an error by either failing to record grants as income or misreporting the amount received or when it was received. This being the case, we recommend that businesses making use of the Government’s grant funding seek advice and support when preparing their accounts to ensure grant income is correctly reported.


Updated – 8th April 2020

Cash grants for businesses that pay little or no business rates

In our previous article we pointed out that businesses that are eligible for small business rate relief (SBBR), rural rate relief (RRR) and tapered relief are eligible to claim a cash grant of £10,000. We are now starting to see local authorities making these cash payments directly into business bank accounts. We would recommend that if you are paying rates on a small building, whether this be rented or owned, that you check to see whether the rateable value is below £15,000 and if it is make a claim to your local authority.

Cash grants for retail, hospitality and leisure premises

There is also help for businesses in certain sectors with a rateable value of less than £51,000 that can claim a cash grant of up to £25,000 per property.  In order to make this claim you need to be in the retail, hospitality or leisure sector.  Please note that the definition of retail is quite wide and it is worth checking the situation regarding your own particular business using this link 

Please note that if your rateable value is over £51,000 you will not qualify for this grant.

Please also note that the rateable value of a property is not the amount of rates that you pay, it is the amount on which the calculation is based.  Your rates bill will detail this.


Updated – 15th April 2020

Accounting for grant payments

Thousands of businesses hope to make use of the various grant payments being made available by the Government and local authorities in response to the Coronavirus pandemic.

However, those in receipt of the new funding will need to make sure it is properly accounted for, which raises the question, how do you account for grant income?

The first and most important point to consider in regards to grant income is whether the income really is a grant or whether it is instead a loan or some other form of financing.

The simple definition is that grant income is income received by you or your company for which you do not have to provide anything in return.

Although you may be required to report your use of the grant or be limited in how it is spent, you will not have to make any form for repayment or reparation, such as the provision of goods or services.

If the grant is for expenditure that you would normally record in the profit and loss account, the grant income is reflected as income in your profit and loss account.

Where a grant relates to specific equipment or another fixed asset then the grant income is deferred and should be released to the profit and loss account to match with the depreciation of the grant purchased asset.

You’re meant to account for the income when it becomes receivable, in the case of the Small Business Grants Fund and Retail, Hospitality and Leisure Grant Fund on the 20 March, not when it is received. This may mean that those with March year-end accounts may need to check how the income is reported.

Corporation Tax 

As grants are generally considered to be a taxable form of income, they can be the taxed the same as any other forms of income, such as money earned through trade, via Corporation Tax.

Where a grant is for expenditure that appears in your profit and loss account and you can defer the grant income, such as through the acquisition of a fixed asset, then you may not have a tax liability on the income as it will be matched with its intended expenditure (i.e. expenditure will cancel out income in your accounts).

In the case of the latest Government Covid-19 grants, it is most likely that you will have to pay Corporation Tax as they are not linked to the acquisition of an asset and cannot be deferred. It is therefore important that you account for this income accurately so that you pay the correct amount of tax in future.

VAT

Grant income is outside the scope of VAT, therefore no VAT is payable when you receive a grant, but you may be able to reclaim VAT from any asset paid for via a grant, as long as it is within the ‘normal’ VAT rules.

Complexity

Many businesses may not have used grant funding before and it is easy to make an error by either failing to record grants as income or misreporting the amount received or when it was received. This being the case, we recommend that businesses making use of the Government’s grant funding seek advice and support when preparing their accounts to ensure grant income is correctly reported.


Updated – 6th April 2020

Revised Coronavirus Business Interruption Loan Scheme (CBILS)

 The Government has also announced major revisions to the CBILS to come into force from today (6th April 2020).  The effect of this is to open this up to a wider range of businesses.

Previously, the scheme was only available to businesses that were not able to access a facility on normal commercial terms.  From today, any business that meets the main criteria must be considered for a CBILS facility, even if they would otherwise qualify for a commercial facility.

As a reminder, the following conditions must apply:

a)      Be based UK based in its business activity

b)      Annual turnover of less than £45million, of which more than 50% is generated via trading activities

c)       Have a borrowing proposal which the lender would consider viable, were it not for the current pandemic

d)      Be able to self certify that it has been adversely impacted by the coronavirus.

The revised note also now gives guidance on how the banks are to deal with the remaining 20% that is not underwritten by the government.

The guidance does confirm that if you have already applied and been turned down that you should approach your bank again.

To help you with this process we have prepared a helpful infographic, which can be downloaded and shared.

Should you have any questions in the meantime, please contact your normal point of contact.


Four new Coronavirus Business Interruption Loan Scheme (CBILS) lenders announced

The Government’s British Business Bank, which oversees the Coronavirus Business Interruption Loan Scheme (CBILS), has confirmed the addition of four new lenders businesses can approach to access the scheme.

The Co-operative Bank, Cynergy Bank, OakNorth Bank and Starling Bank are now able to provide CBILS loans to businesses.

The Scheme provides UK-based SMEs with turnovers of up to £45 million access to facilities of between £1,000 and £5 million interest-free for 12 months, backed by an 80 per cent guarantee from the Government.

Amendments to the scheme announced in April mean that any business with turnovers of up to £45 million that has been affected by the crisis can access CBILS loans, even if they would otherwise qualify for facilities on normal commercial terms.

The British Business Banks says that businesses that meet the following conditions must be considered for CBILS:

The latest lenders accredited to offer CBILS loans join more than 40 lenders already lending through the scheme, including the UK’s largest high-street banks.


Updated – 30th March 2020

Cash grants for retail, hospitality and leisure businesses

The Retail and Hospitality Grant Scheme provides businesses in the retail, hospitality and leisure sectors with a cash grant of up to £25,000 per property.

Businesses in these sectors with a property that has a rateable value of up to £15,000 may be eligible for a grant of £10,000, whilst businesses in these sectors with a property that has a rateable value of between £15,000 and less than £51,000 may be eligible for a grant of £25,000.

Eligibility

You are eligible for the grant if:

Properties that will benefit from the relief will be occupied properties that are wholly or mainly being used:

How to access the scheme

Whilst it was originally announced that you would not need to do anything as the local authorities would write to those businesses eligible for the grants, the local authorities have been updating their websites to include the facility to claim the grants.

Ashford Borough Council

Folkestone & Hythe District Council


Cash grants for businesses that pay little or no business rates

The government will provide additional Small Business Grant Scheme funding for local authorities to support small businesses that already pay little or no business rates because of small business rate relief (SBRR), rural rate relief (RRR) and tapered relief.  This will provide a one-off grant of £10,000 to eligible businesses to help meet their ongoing business costs.

Eligibility

You are eligible if:

How to access the scheme

Whilst it was originally announced that you would not need to do anything as the local authorities would write to those businesses eligible for the grants, the local authorities have been updating their websites to include the facility to claim the grants.

Ashford Borough Council

Folkestone & Hythe District Council