Cracking the Cost of Living: Small business grants you could be eligible for in the UK
Looking for funding opportunities for your small business, but unsure where to start?
The good news is, there are hundreds of small business grants to help launch start-ups and small businesses. Did you know the UK Government alone has over 100 funding programmes available UK-wide?
From support with apprenticeships to grants to help with the rising cost of living, there’s help available to launch your start-up or new business venture as part of the bigger drive to kick-start the economy.
In this guide, we’ll explore some of the different small business grant funding opportunities on offer and provide tips on how to maximise your chances of success when applying.
What’s the difference between a small business grant and a loan?
The key difference between a small business grant and a business loan is that you have to repay a loan, whereas this isn’t the case with a grant.
Business grants are payments either awarded by the Government or a private organisation for a specific purpose, such as research and development, or to help with energy and the rising cost of living. Unlike business loans, you also don’t have to give away a share of your business
However, the fact business grants don’t have to be repaid can make the process to get a small business grant both competitive and complex. Many grants also have conditions attached, meaning they have to be repaid if you fail to meet them. It’s therefore always important to read the small print before applying.
British-business-bank.co.uk has produced a guide with additional advice on how small business grants work.
With a business loan, you borrow a sum of money, which then has to be repaid with interest. Typically, you can borrow up to 25% of your annual turnover and lenders can range from high-street banks and challenger banks to online lenders and smaller, more local specialists.
If you’re looking at finance options for your small business, check out our guide on how to apply for a business loan for tips and advice on how to increase your chances of success.
How to apply for small business grants in the UK
Whether it’s support with the cost of living or help to grow your exports, the best place to start with finding suitable small business grants is to search online. Platforms such as Swoop Funding enable you to make tailored searches for funding providers according to the type of business you run.
Other good places to start are the UK Government’s business finance finder and the regional funding portals that will help you identify grants that suit your business.
Business grants will typically have strict funding criteria. These can be based on:
– the region where your business is based
– the nature of your business
– whether the grant provider has an area of focus your business could help with – for instance, research and development
As getting a small business grant can be a challenge, here are our top tips for boosting your chances of success.
1. Speak to the funder before applying
It’s always worth getting in touch with the awarding body before you apply. Not only will you be able to tell them about your business, but you may be able to speak to business grant funding experts who will be able to give you advice on how to structure your application.
It’ll also help you to have a contact name who will know your business and be able to offer advice in the event of any delays.
2. Apply early
As funding bodies for small business grants can receive large numbers of applications, it’s always best to get yours in as early as you can.
By applying as soon as the grant opens, you won’t be up against as much competition, as fewer people will know about it. One tip for applying early is to keep searching for funding opportunities online to stay up to date on when new business grants become available.
3. Be clear on the grant objectives
A little research always pays off, so take some time to find out why your chosen grant is being awarded, as well as understand its aims – such as promoting sustainability or helping with the cost of living by supporting energy costs.
Make sure your application makes reference to the objectives as closely as possible to stand the best chance of success.
4. Find an expert
If you struggle with form-filling, you can engage the services of a professional to research opportunities, write your business grant proposal or even submit the application on your behalf.
5. Write a strong business plan
Just like with applying for a business loan, any grant awarding body will expect to see evidence of a strong business. If you need support in this area, you can hire a freelance expert to help you write a business plan.
Our guide explains more about the importance of a startup business plan.
6. Secure match funding
Most grants will require you to match the amount you’re willing to invest. So, if you’re seeking a grant of £20,000 towards new equipment, make sure you have a matching amount available.
Startuploans.co.uk provides more tips for completing applications for small business grants from government funding initiatives.
What small business grants are available in the UK?
A wide range of grants for small businesses and start-ups are available from different funding bodies in the UK.
R&D Tax Credits
Did you know that UK companies are able to claim tax relief for their research and development activities? These schemes are administered by HMRC and are designed to help boost innovation. They support businesses looking to improve their products and processes.
Govgrant.co.uk provides more details on how the scheme works and the eligibility criteria.
Also associated with research and innovation, you can get up to £5,000 to cover the cost of help and support from an external expert or consultant in Innovation Vouchers. Supplied by the UK Government via Innovate UK, this scheme provides support for areas such as new technology and intellectual property and is available to both start-ups and established SMEs.
The Prince’s Trust
Aimed at young entrepreneurs aged between 18 and 30, the Prince’s Trust offers a free enterprise scheme. This can provide funding opportunities, as well as mentoring and support to young people seeking to start their own businesses.
If your business pays the Apprenticeship Levy, then you can get funding from the government to pay for the training and assessment of your apprentices. The government will add 10% to this.
If you don’t currently pay the levy, you will pay 5% towards the costs of training and apprenticeship assessment and the government will pay the remaining 95%. This funding will be paid directly to the training provider.
Full details of the apprenticeship scheme and funding can be found at GOV.uk
Energy Bills Discount Scheme
The UK Government’s Energy Bills Discount Scheme replaces the Energy Bill Relief Scheme and runs for 12 months from 1 April 2023. Its aim is to provide a discount on eligible business gas and business electricity contracts to provide support to businesses with the cost of living.
With rising energy bills, if you’re worried about the cost of living and impact on your business check out our guide on ways to reduce your business energy costs.
Help to Grow
Another source of support is the UK Government’s Help to Grow campaign, a nationwide initiative to help start-ups and SMEs grow the economy and generate opportunity. A free business helpline provides support and advice to business owners, as well as signposting to funding opportunities.
Help to Grow Management is a free 12-week course designed and delivered by entrepreneurs and industry experts to help small businesses boost their performance and develop resilience.
Local Enterprise Partnerships
A potential source for regional funding, the 38 Local Enterprise Partnerships or LEPs are business-led partnerships between local authorities and local private sector businesses. They help to drive economic growth and job creation and support businesses within their local area. Connected to each of the 38 LEPs is a growth hub, which can provide advice on regional small business grant opportunities to help with expansion and with the cost of living.