Last week, Boris Johnson announced that non-essential retailers could reopen on April 21st – contingent on coronavirus rates.
This week, Rishi Sunak revealed the government's 2021 Budget, which included the government's £5 billion grant scheme for England's high streets.
The Chancellor said that the grants he coined 'restart grants' will be available for non-essential retailers, gyms, outdoor hospitality and personal care businesses, such as hairdressers and beauty salons.
These businesses are set to reopen on April 12th and are eligible for up to £6,000 per premise.
Those businesses that will remain closed until June, such as all indoor hospitality and nightclubs and other events, could receive up to £18,000 in grants from the government, based on their size.
It is believed that almost 700,000 small businesses across England will be eligible for the restart grant.
Local authorities will distribute these new grants directly to businesses ahead of their reopening. They replace previous direct cash grants and loans such as the bounce-back loan (BBL) and the coronavirus interruption loan scheme (CBILS), ending in March.
These new restart grants are for businesses operating in England, but devolved nations are set to receive an extra £794 million worth of funding to kickstart economies.
As well as the restart grants, Rishi Sunak announced in the Budget some other government incentives to help kickstart the economy.
We've outlined the most relevant ones for business owners, below.
The furlough scheme
Employers can still furlough staff until the end of September, with the government promising to pay salaries up to 80%. Firms will be asked to contribute 10% in July and 20% in August and September before the scheme is eventually phased out.
Self-employment Income Support (SEISS)
In addition to the furlough scheme's extension, the Chancellor announced that the government is extending the self-employment income support scheme.
Until now, the scheme has seen the self-employed across England receive three grants – if COVID-19 has impacted their business. Today's Budget announced that there would be a fourth and fifth.
The Recovery Loan scheme
The announcements mentioned new government loans for businesses of all sizes to replace those CBILS and BBS. The new loan scheme, currently known as 'The Recovery Loan Scheme', will open on April 6th and runs until the end of the year.
It allows business owners to borrow £25,000 up to £10 million from a network of government-backed lenders.
Business owners can use their funding for any legitimate business purpose, including growth.
There will be more details on how businesses can apply for this in the coming weeks.
Business rates
The Chancellor confirmed that non-essential retailers and the hospitality and leisure sector would continue to see a business rate holiday at 100% up until the end of June.
After June, rates would be discounted by two-thirds, up to a value of £2 million for closed businesses.
VAT
VAT will continue at a reduced rate of 5% until the end of September to help manage cash flow. There will be a new VAT rate of 12.5% from October onwards, which will remain unchanged until the end of March 2022.
Alcohol duties
Sunak announced that he had cancelled the planned increased duties for spirits, and he will freeze all alcohol duties for the second year in a row. This means that pubs and restaurants will not pay duty on beers, ciders and spirits, including Scotch whiskey.
Roundup
In his speech on Wednesday, Rishi Sunak clarified that although the government has outlined its roadmap to recovery, businesses will receive support after reopening and beginning to trade again.
The Chancellor stated that these new schemes and those applied last year would bring the total funding for small businesses to £407 billion.
If you're a small business owner preparing to reopen in April, be sure to leverage these funding opportunities and keep updated with government funding schemes and how to apply for them in the coming weeks.
To see the full 2021 Budget speech and find out more about the above incentives, visit the government website here.
