This months guest blog is from Wright CFO Ltd, who offers flexible and part time finance director expertise.
When you’re just starting out with a new business it can be tough to get things off the ground without additional capital. There are many schemes and grants available in the UK to help with initial cash investment or if you need additional funds to expand. In this blog we will take you through what you need to know and share some links to help you find more information.
Grants are non-repayable funds given by one party, often a government department, corporation, foundation or trust, to a business, non-profit organisation or individual. Grants vary in size and in complexity. Many grants are match funded, meaning that to be eligible for a grant the applying business must be able to raise a percentage of the total cost of the project, with the grant award providing the remainder.
It is non repayable, you therefore do not have to repay or pay interest on the money you receive. You will not have to give away equity in your business. Exposure – receiving a grant can often come with some much welcomed publicity for your business. Non Monetary support – as well as the money that a grant can offer a business, they can also provide you with mentors, advice and expertise that you would not otherwise have access to.
Complex and competitive – to apply for a grant you will have to go through an often lengthy application process. This can be extremely time consuming and involve a number of application rounds. In addition, the grants are very competitive so if you are ultimately unsuccessful you will have invested a lot of time for no return. Niche – grants are often offered for very niche areas, so it is not always simple to find the right one for your business. They also tend to come with some specific conditions for how you spend the grant and what specific project the money should be spent on. Waiting – In addition to time spent on the application itself, it can take several weeks, if not months, to find out if you have been successful in your application for a grant. It’s important to factor this into your business planning as it is not likely to be a quick fix for a cash injection.
The Entrepreneur Handbook has a fantastic round up of grants and funding opportunities available to small businesses in the UK, broken down by subject and by location, with details on each including eligibility and available funding amounts. You can take a look at the complete list here.
Grant providers covered include:
Research and Development Tax CreditsPrinces Trust GrantsSmart GrantsHeritage Lottery Fund Start-UpThe FedEx Small Business GrantArts Council England FundingNew Enterprise AllowancePatent Box SchemeBritish Council GrantsSpaces 4 ChangeBetter Broadband Subsidy SchemeSmall Business Grant
The above is a summary of the grants available. if you are looking for a grant for your business the key to success is research, research, research. You can use the tools and links in this article to help you find the right grant for your business.
The government’s ‘business finance support finder’ directory lists over 300 direct grant agencies and aims to help you find the right scheme for your start-up.
Find out about other government support for small businesses and read about those who have already benefited from it at the GREAT Business website, here.
Startups.co.uk offers some excellent information and advice on grants for start ups. You can read more here.
Their section on tax relief is particularly helpful. The following schemes are useful to be aware of:
Business rates relief: You are eligible if your business only occupies one property, and the rate able value of that property is less than £15,000. Employment Allowance: This enables you to reduce the national insurance contributions you pay for your staff by up to £3,000 per year. Corporation Tax relief: If you are investing in research and development, you may be able to apply for Corporation Tax relief on the project. Enterprise Zones: designated UK areas which offer tax reliefs and support to the eligible businesses launching in them.
If your business is based in Scotland, Small Business compiled a complete list of Scottish business grants, you can take a look here.
*Please be aware the information provided above is meant as a general guide only rather than advice or assurance. Wright CFO does not guarantee the accuracy or completeness of this information and professional guidance should be sought on all aspects of the business planning. Use of any of the above resources are entirely at the risk of the user’.