COVID-19 Business Support Grants: Local Authority Discretionary Grant Fund
This is an additional fund to the Small Business Grant and the Retail Hospitality and Leisure Grant. It is aimed at certain small businesses who were not eligible for the Small Business Grant Fund or the Retail, Leisure and Hospitality Fund, and which have relatively high ongoing, fixed property-related costs, and which can demonstrate that they have suffered a significant fall in income due to the COVID-19 crisis.
The Government guidance issued on 13 May and 22 May 2020 gives the Council discretion over the scope and eligibility criteria for the grant scheme, and its decisions regarding the scheme will be final.
Businesses that have not previously been able to apply for a grant in their own right as they do not have a separate rating assessment, may now apply to this scheme if they meet all of the other eligibility criteria.
Businesses eligible to apply to the scheme must have been trading on the 11 March 2020, located in the borough of Gateshead and be:
small and micro businesses, as defined in Section 33 Part 2 of the Small Business, Enterprise and Employment Act 2015 and the Companies Act 2006 (see below) that occupy shared offices or other flexible workspaces commercial property not subject to their own rates assessment, including market traders, or
bed and breakfasts which pay Council Tax instead of business rates and were registered with the Council's licensing team on 11 March 2020, or
charities occupying properties in receipt of charitable business rates relief which would otherwise have been eligible for Small Business Rates Relief or Rural Rate Relief
To be a small business, under the Companies Act 2006, a business must have less than 50 staff and satisfy one or both of the following requirements in a year:
turnover of not more than £10.2 million
balance sheet total of not more than 5.1 million
To be a micro business, under the Companies Act 2006, a business must have no more than 10 staff and satisfy one or both of the following requirements:
turnover of not more than £632,000
balance sheet total of not more than £316,000
Applicants must be able to demonstrate:
Ongoing fixed property-related costs of at least £250 per month. Eligible costs to include, rent, mortgage payments, insurance, utilities and business rates. Car parking is not an eligible cost.
A significant fall in income due to the COVID-19 crisis
That they were trading on the 11 March 2020
Businesses who have applied for the Coronavirus Job Retention Scheme and those eligible for the Self-Employed Income support scheme (SEISS) are eligible to apply for this scheme.
Businesses eligible for cash grants from any other central government COVID-19 related scheme are ineligible for funding from the Discretionary Grants Fund. Such grant schemes include, but are not limited, to:
Small Business Grant Fund
Retail, Hospitality and Leisure Grant
The Fisheries Response Fund
Domestic Seafood Supply Scheme (DSSS).
The Zoos Support Fund
The Dairy Hardship Fund
Further ineligible businesses include:
businesses that employ more than 50 people
businesses with a current rates account
companies that are in administration, are insolvent or where a striking-off notice has been made
businesses operating from a domestic property, excluding bed and breakfasts
The Council reserves the right to vary the terms of the scheme at any time, and without notice, should it be necessary to do so.
The Council will not approve or make payment of a further grant to a business that has already received a grant or partial grant passed on by a landlord under one of the schemes mentioned above.
For an application to be considered, eligible businesses are required to demonstrate that they meet the eligibility criteria above. To do this you will need to provide:
evidence of property costs such as rent, rates or mortgage payments, this should take the form of leases/agreements covering 11 March 2020 showing an obligation to pay and bank statements showing that payments have been made
a declaration that the business has suffered a substantial loss in income as a result of the current situation
confirmation of complying with the definition of a Small or Micro Business as set out above
confirmation that the business has not received any grant under the grant schemes mentioned in above
The United Kingdom left the EU on 31 January 2020, nonetheless under the Withdrawal Agreement the State aid rules continue to apply during a transition period, subject to regulation by the EU Commission.
Grant awards of up to and including £10,000 can be provided under the De Minimis rules, meaning applicants can receive up to €200,000 of aid within a three year period. Applicants will be required to declare any other de minimis aid received in the last three years.
The Council has been awarded limited funds from Government for this scheme and it is expected that there will be a high level of demand from businesses. In order to assist as many priority businesses as possible, grants to eligible small and micro businesses are limited to £5,000. The permitted allocations of £10,000 and £25,000 will only be made in very exceptional circumstances.
Payments will be made directly to approved recipients' bank accounts by electronic transfer.
Beneficiaries will receive written confirmation stating that by accepting the grant payment, the business confirms that they are eligible for the grant scheme, including that any payments accepted will be subject to state aid requirements.
Grant income received by a business is taxable therefore funding paid under the Local Authority Discretionary Grants Fund will be subject to tax. Only businesses which make an overall profit once grant income is included will be subject to tax.
The Government and the Council will not accept deliberate manipulation and fraud and any business caught falsifying their records to gain grant money will face prosecution and any funding issued will be subject to claw back, as may any grants paid in error.
State Aid rules and requirements apply to this grant scheme.
The Council does not accept any liability for any issues that may arise for businesses because of applying for, receiving, or not receiving grant payments under this scheme. Enquiries about the scheme can be emailed to firstname.lastname@example.org.
Payment of grants is subject to the availability of funds.
There will be no appeals process.
Please note if your business operates from more than one property a single grant will be awarded.
The Gateshead Discretionary Grant Fund will close to new applications on 30 June 2020 or earlier if available funds are committed.
Applications for the grant will be made through an online form and businesses will be required to confirm they are eligible for the scheme.
How to apply
Before you apply for the grant, read the guidance notes above and check your business is eligible to apply. Have the following example information ready:
- your lease, or licence, or any written agreement between you and whoever you pay to use your business premises
- your bank statements
- your company number, or your unique tax reference number (UTR) if you are self-employed
- if you are a bed and breakfast business, you will need your council tax reference number
- if you are a charity, your charity number
- supporting evidence as outlined in the guidance notes