Types of business grants
There are hundreds of grants available to UK businesses but most have set criteria. This can include:
- Business size: Grants are often limited to businesses with a maximum number of employees or size of turnover.
- Business sector: Many grants are for companies operating in specific industries.
- Business type: Getting a grant might be dependent on the type of business such as sole traders, limited companies and social enterprises.
- Age of business: New start-ups are often the target of grants, while others are for more established businesses.
- Founder demographics: Some grants are aimed at specific people such as young entrepreneurs and female business owners.
- Location: Grant schemes are available for businesses in particular towns, cities and regions.
- Purpose: Funding schemes usually have a clear objective so will only provide a grant to businesses that can meet it. Examples include job creation, sustainability and research and development.
Grant schemes vary in the way the money is paid to businesses. Some will pay the grant in full, while others will be match funded. This means you have to match a proportion of the funding out of your own funds, from a partner business or via external finance.
Some schemes combine the grant with a loan. You will need to pay back the loan element.
Where to find business grants
There are lots of business grants available with the main sources being the UK and devolved governments, local authorities and charitable organisations.
Grants can often be well hidden on websites so you might need to spend a bit of time tracking them down.
Some local councils provide grant funding to small businesses. You can find your local council website here.
Other initiatives, schemes, organisations and charities providing business grants include:
- Innovate UK for innovation projects.
- Government funding for taking on apprentices.
- Government funding for attending tradeshows.
- Help to Grow: Digital covering 50% of the cost of software.
- National Lottery Community Fund for community projects.
- National Lottery Heritage Fund for heritage organisations.
- UnLtd for social enterprises.
- Prince’s Trust for young entrepreneurs.
- Horizon Europe for researchers and innovators
- Arts Council for creative, arts and cultural businesses in England, Wales and Northern Ireland. In Scotland, Creative Scotland does the same.
- UK Games Fund for the games development sector.
- British Film Institute for film and TV production companies.
- British Fashion Council for fashion businesses.
- Gigabit Broadband Voucher Scheme for businesses experiencing slow broadband speeds in rural areas.
Some business award schemes provide grants as prizes. Keep an eye on the media for award announcements and check the websites of business support organisations.
How to apply for a business grant
Key to applying for a grant is understanding the criteria. You need to make sure your business qualifies for the funding otherwise it will be a waste of time filling in the application form.
Applying for a grant can be a very long process so the earlier you start the better. If you know you have a few months to apply, don’t wait until a few days before the deadline but spend a few hours a week preparing your application. Many organisations let you save the information and return to it later.
It is vital that you understand how the grant will be paid. If it’s match funded, you need to make sure you have the money available or have a plan for getting it. You will need to clearly demonstrate that to the funding organisation.
Read all the grant information carefully so that you know what details you need to provide. Answer the questions concisely and in the exact way that you are asked to do so. Don’t include additional information that isn’t required. Back up your statements with supporting evidence. If there’s a word limit, you should stick to it.
You will be asked what you need the grant for and how you will spend it. This is the most important section of your application, so you need to get it right. Refer to the grant criteria and clarify that the project or business activity you are seeking the funding for is relevant. Communicate clearly your reason for the grant and how it meets the objective of the scheme.
If the grant is paid in instalments rather than as a lump sum, it could impact on your cash flow. This is also something that an accountant can help with and factor into your application.
What to do if your grant application is rejected
Getting a business grant can be a competitive process so if your application is rejected, don’t be too disheartened.
Read any feedback provided by the funding organisation and bear it in mind if you apply for another grant. If they don’t automatically provide feedback, ask for it.
Keep hold of the information you submitted as many schemes ask for similar details and you might be able to use it again.
Date published 1 Jul 2022This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.