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Resources

Coronavirus-related loans, grants and finance for businesses

Resources

Coronavirus-related loans, grants and finance for businesses

Here we've summarised the various loans, grants and finance being made available to businesses affected by the pandemic.

Updated 1 April 2022

What’s new on 1 April 2022

See the relevant section below for more detail:

Grants

The Coronavirus Statutory Sick Pay Rebate Scheme has now closed. The scheme was designed to help employers claim back employees’ coronavirus-related Statutory Sick Pay (SSP). Employers had up to and including 24 March 2022 to submit any final claims, and amend claims they’d already submitted.

Loans

Recovery Loan Scheme – A number of changes to the Scheme came into force on 1 January 2022.

Grants

THE OMICRON HOSPITALITY AND LEISURE GRANT

Introduced at the end of 2021, this grant provides local councils with one-off grant funding to support to hospitality, leisure and accommodation businesses, in recognition that the rise of the Omicron variant means and the difficulties it is presenting for businesses. Qualifying businesses include those:

The grant is covered 3 possible subsidy allowances. These can be combined for a potential total allowance of up to £12,235,000. For more information on the Scheme see this page on the Government website: Check if you’re eligible for the Omicron Hospitality and Leisure Grant. Be aware applications will need to be made via your local Council.

THE CORONAVIRUS STATUTORY SICK PAY REBATE SCHEME

This scheme was established in the early stages of the pandemic in 2020. It enabled employers to be repayed the Statutory Sick Pay which they had paid to current or former employees. The scheme was reintroduced in early 2022. In this guise employers could claim for employees who were off work on or after 21 December 2021 to 17 March 2022.

The Scheme closed to covid-related absences after 17 March. Employers had up to and including 24 March 2022 to submit any final claims, and amend claims they’ve already submitted

For the latest information see this Gov.uk page: Check if you can claim back Statutory Sick Pay paid to employees due to coronavirus (COVID-19).

JOB CREATION GRANTS

TRAINEESHIPS

Employers who provide work experience for 16-24-year-olds in work placements and training will receive a payment of £1,000 per trainee. Provision of traineeships and eligibility for them will be extended to those with Level 3 qualifications and below, to ensure that more young people have access to training. 

The incentive has been extended until July 2022. Claims for placements completed on or before 31 July 2021 had to be made by the end of September 2021 to allow time for any errors to be corrected.

For more information see Traineeship information for employers. Information about claiming the incentive can be found here: Employer Incentive Payments.

PAYMENTS FOR EMPLOYERS WHO HIRE NEW APPRENTICES

In the third guise of this scheme, which has run since August 2020, Employers could apply for a payment of £3,000 for new apprentices with an employment start date from 1 October 2021 to 31 January 2022. See Incentive payments for hiring a new apprentice.

Organisations could apply for apprentices with an employment start date from 1 October 2021 to 31 January 2022. They also need to have an apprenticeship start date from 1 October 2021 to 31 March 2022. Note employers must set up an apprenticeship service account before they can apply.

KICKSTART SCHEME

The Kickstart Scheme was created to provide high quality six-month work placements for those aged 16-24, who are on Universal Credit and considered to be at risk of long-term unemployment. 

Government funding for each job covered 100% of the relevant National Minimum Wage for 25 hours a week plus the associated employer NICs and employer minimum automatic enrolment contributions (a maximum of about £6,500). There was also £1,500 per job placement available for setup costs, support and training.

The scheme has now ended. See Kickstart Scheme closure for further information

The Self-Employed Income Support Scheme

BACKGROUND

In Autumn 2020 the Chancellor announced the SEISS was to be extended from 1 November 2020, in the form of two new grants (known as the third and fourth grants, given the previous two already distributed since Spring 2020). Both the third and fourth grants would be available for three month periods covering:

The Government’s third taxable grant covered 80% of average monthly trading profits, paid out in a single instalment covering 3 months’ worth of profits, and capped at £7,500. Note the closing date for claims of the third SEISS grant has now passed (29 January 2021). 

The grant had been increased from the previously announced level of 40% of trading profits to 80% of trading profits, for 1 November 2020 to 31 January 2021.

In his Budget on 3 March 2021, the Chancellor announced that the SEISS will continue until September with a fourth and fifth grant.

The fourth and fifth grants took into account submitted 2019-20 tax returns. To qualify they must have submitted their 2019-20 tax returns by 2 March 2021 to be eligible for the fourth and fifth grants. They must have also traded in the 2020/21 tax year.

THE FOURTH AND FIFTH SEISS GRANTS – BOTH SCHEMES ARE NOW CLOSED FOR APPLICATIONS

With the fourth grant, the Government paid a taxable grant which was calculated based on 80% of three months’ average trading profits, paid out in a single payment and capped at £7,500 in total. 

The value of the grant was based on an average of the self-employed person’s trading profits for up to four tax years between 2016 to 2020, where available. As with previous grants, trading profits couldn’t be more than £50,000 and at least equal to non-trading income in order to claim the fourth SEISS grant.

Eligibility for the fourth SEISS grant also depended on if you had experienced a significant financial impact from coronavirus between February 2021 and April 2021. As the calculation took into account the tax year 2019-20, if you previously claimed SEISS grants you could receive grants that were higher or lower in value than any previous SEISS payments received.

The fifth and final SEISS grant covered May to September 2021. The amount of the fifth grant was determined by how much a self-employed business’ turnover has been reduced. The grant was taxable and was paid out in a single instalment.

The grant was worth 80% of three months’ average trading profits, capped at £7,500, for those with a higher reduction in turnover (30% or more). For those with a lower reduction in turnover, of less than 30%, then the grant was worth 30% of three months average trading profits and capped at £2,850.

THE ONLINE CLAIMS SERVICE FOR THE FOURTH AND FIFTH GRANT HAVE CLOSED.

Note: The grants are subject to income tax and National Insurance contributions, but do not need to be repaid. Recipients are warned to be mindful of when the tax is due on the various grants – see Getting the timing right for your Self-Employed Income Support Scheme grant tax liability.

UPDATE: JANUARY 2022.

If applicants have not been able to make a claim for an SEISS grant due to an HMRC error or other exceptional circumstances, they have until 28 February 2022 to contact HMRC. Similarly, if you think your grant amount is too low, you must also contact them by 28 February 2022. See Return to your claim for the Self-Employment Income Support Scheme.

Loans and finance

In December 2020 the Chancellor announced that the closing date for the Government’s three Coronavirus business interruption loan schemes would be extended further to 31 March 2021. This extended the previously scheduled closing date of 31 January 2021.  See Chancellor extends furlough and loan schemes

THE RECOVERY LOAN SCHEME

The Recovery Loan Scheme launched on 6 April 2021. It gives businesses access to loans and other kinds of finance. This finance can be used by the businesss for any legitimate business purpose, including growth and investment. Eligible businesses could apply for the Recovery Loan Scheme – even if they had taken out a loan under the previous Coronavirus business interruption loan schemes.

Loans are available through a network of accredited lenders, listed on the British Business Bank’s website – see Recovery Loan Scheme.

CHANGES FROM 1 JANUARY 2022

From 1 January 2022, the following changes have come into force:

Finance options

A lender can provide up to £2 million as one of the following facilities:

No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.  For businesses borrowing more than £250,000 the lender has the discretion to decide whether to take personal guarantees. However the maximum amount that can be covered under Reovery Loan Scheme (RLS) is capped at a maximum of 20% of the outstanding balance of the RLS facility after the proceeds of business assets have been applied

The time limit for the loans is:

For more information visit the Recovery Loan Scheme page on the British Business Bank website.

TO APPLY

Accredited lenders are published on the British Business Bank website – see Recovery Loan Scheme: current accredited lenders. We can also introduce you to accredited lenders, and please talk with your usual Shipleys contact if this would be helpful.

Other financing measures

In addition to the Government support, other lenders are initiating financing options to help businesses in areas such as spreading the cost of equipment purchases, short-term loans, finance against unpaid loans etc. 

Capitalise

One particular resource we recommend is Capitalise.  This is a a platform where businesses can find, compare and select the right lender in a matter of minutes. As well as finding lenders who specialise in your industry, you’ll also find lenders most likely to give you an offer. 

Captilalise cover finance for a wide range of areas including asset finance (funding for any asset), invoice finance (using your invoices to get funding), merchant cash advance (using your credit card transactions to get funding), trade finance (paying for goods based on an order), working capital loans (to finance everyday operations) and property finance (to gain access to bridging loans, development and commercial finance).

Also talk to one of our team for introductions to other providers of finance.

Summary and can we help?

We will continue to monitor the announcements from the Government and update this page as new grants and funding sources emerge.  In the meantime, please do get in touch with your usual Shipleys’ contact if you need any further advice or call one of our offices.

London: +44 (0)20 7312 0000  or email advice@shipleys.com

Godalming: +44 (0)1483 423607 or email godalming@shipleys.com

Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary. If you would like advice or further information, please speak to your usual Shipleys contact.

Copyright © Shipleys LLP 2021

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