Small Business Grants

Starting and growing a small business in the UK often requires significant financial investment. Obtaining that initial capital can be difficult, but thankfully there are many avenues available to the entrepreneur to help get a business off the ground, or to keep it working once launched. 

The Difference Between a Grant and Other Small Business Financing 

One of the key benefits of a grant when compared to other financing available to small businesses is that a grant is not a loan and never needs to be repaid. It is essentially gifted to your company to help you grow. 

However, this “free money” comes with certain conditions. Unlike a small business loan that provides capital to be used however the business sees fit, a grant is typically for a specific purpose and must be used for that purpose.

Furthermore, grant eligibility can be complex, with many grants limited to businesses in a certain field, in a defined region, or those whose owners represent a particular group. 

If you and your company fulfil the criteria for a grant, however, then it is usually worth applying as grants are an excellent way to boost your business capital without taking on any additional debt. 

Types of Small Business Grants 

Small business grants in the UK are provided by several organisations, including the government, local authorities, charities, and private corporations.

They are designed to further growth and support the national economy by improving the conditions for businesses nationally and do this by injecting money into smaller growing businesses. 

Direct Grants 

The most understood type of grant is that which provides money directly to the business. These grants come with conditions regarding how the money is spent, but will providing funding in order to undertake a specific project. 

Resource and Training Grants 

Many grants are available to help a business grow through providing training, the value of which should not be underestimated. 

Businesses in the early stages can make exceptional use of grants to help develop business plans, bring in external experts for consultation, understand various tax and accounting options, and more. 

These sorts of grants are often provided by business support networks, which are themselves an excellent resource for getting advice and improving your business, especially in the early days of small business startup. 

Tax Relief 

The concept of grants also covers a range of tax relief initiatives and tax allowances developed by the government.

While these do not provide additional capital for the business, they can significantly lower the amount that your company needs to pay to HMRC, effectively freeing up cash and improving overall cashflow. 

Understanding your tax allowances and applicable tax relief can lift the financial burden of your growing company significantly. 

Finding a Grant 

Perhaps the first port of call when considering a small business start up grant is the main UK government website.

Through the simple search engine, there are links to a wide range of grants that include those directly supported and funded from the government, as well as a number of local authority and other private organisation grants. 

Other organisations such as the Prince’s Trust, or UK Research and Innovation (UKRI) provide grants and help in achieving funding. It is also always worth checking your local authority websites and Local Enterprise Partnerships (LEPs) for grants that are more specific to your region. 

The range of grants available to small businesses in the UK is always changing as schemes come and go. What might be available one year could be gone in the next, with new and different opportunities replacing it.  

Finding grants to fit your business requires a period of research that may seem difficult at first, but patience and perseverance will yield positive results. 

Qualifying for a Small Business Grant 

Each grant program will have specific eligibility criteria that applicants must meet. These criteria may include factors such as the size of the business, location, industry sector, and the intended use of the grant funds. Common eligibility requirements include: 

Business Size 

Grants are often targeted for specific business types. Micro, small, or medium-sized enterprises (known as SMEs) will find a large number of grants that are designed specifically to fill the needs of starting up a business or early growth.

Larger companies will similarly find grants available that are better developed to take into account the different needs and wider scope of these businesses. 

Applicant’s Demographic 

Some financial support is set aside for applications based on age, gender, or other factors. The Prince’s Trust, for example, is a grant system that is meant to help young people start businesses and has less relevance for anyone not aged between 16 and 20.  

Industry Sector 

Many grants are developed to further companies in a specific sector, especially those that are provided by other successful organisations in the same field. Certain grants will be available, for example, for those specifically in arenas such as agriculture, retail, or technology. 

Location 

Location has a significant impact in receiving a grant. Many government and local authority grants are available based on region.  

These region-specific grants are developed to promote growth in the that area and it may be worth considering relocating a business in the start-up stage to take advantage of some of the most beneficial grants available. 

Overall however, most locations in the UK are well served and though the specifics of support may differ from one location to another, some sort of grant scheme is typically available to all. 

Purpose of Funding 

One of the most significant factors in determining grant eligibility is that of purpose. Most grants are specifically earmarked for a specific purpose.

Examples include grants for research and development, those to target job growth and apprenticeships, and others that are focussed on supporting businesses with dedicated environmental initiatives. 

Applying for a Grant 

It is essential that you are meticulous in your grant application. Many grants are competitive, with limited assets on offer. In this way, your application will need to stand out against others in your field to have a chance at success. 

First ascertain if your business is eligible, then check any other criteria to ensure that the grant lines up with your business process. Once you are sure the grant is relevant, you can prepare your application. 

Every application should be undertaken with care. 

Step 1 – Reading the Guidelines 

The grant application website will cover the criteria and requirements in great detail. Make sure that you don’t miss anything here and double check the application deadline, what documentation is required, and any other specific instructions you should follow. 

Step 2 – Prepare Your Documentation 

A grant application will stand or fall on your presentation. It is important that you present your business as the professional body that it is.

You are likely to need a comprehensive business plan, your financial statements, a complete proposal of your project, and all relevant evidence that your business is eligible. 

Often the documentation will need to be prepared in collaboration with others, such as your accountant or any business partners. For this reason, it should be prepared in good time so that nothing is missing at the last minute. 

Step 3 – Fill in the Application Form 

Never rush to fill out the application form. Make sure that you follow all instructions and provide information that is 100% accurate. Again, presentation is key, so check every small detail such as typos or spelling mistakes.

Make sure all documentation is properly attached and in an appropriate format. 

When submitting the application, keep a record of it and any references supplied. 

Step 4 – Wait 

Grant applications often go through an evaluation process that may involve a review panel or assessment by experts. You may have to be extremely patient while awaiting a decision. 

Tips for Grant Applications 

In a competitive environment you want to make sure you have the best possible chance. Here are our top tips for securing a small business grant: 

• Thoroughly research the grant – There is little point applying for a grant that doesn’t properly match your business objectives. Take the time to properly research and understand the grant and its purpose. 
• Ensure you meet the eligibility criteria – Failing to meet the criteria properly is the first hurdle where many businesses trip up. Applying for a grant can be a long process, so wasting your time simply because you don’t properly check eligibility can be costly. 
• Have a good business plan – A well developed business plan is key to obtaining funding so it is essential that you have this document. A good business plan that clearly outlines your goals, strategies, and projected outcomes can be used for all your funding application and is valuable at many other times, so it is always worth getting this essential document perfect. 
• Be unique – If you can show how your project stands out from the crowd, it is more likely to attract attention. 
• Demonstrate suitability – You know what the decision makers are looking for, so clearly show how your company and project match their desire. When looking at regional grants, for example, showcase how your business will help the local economy; if applying for a grant for research, detail how innovative your company is. Focus on the positive impact and how your goals align. 
• Consider professional advice – Just as you would use an accountant to calculate your forecast, consider the services of a grant advisor in completing your application, or the services of a copywriter when framing your application.  

Mistakes to Avoid 

We all make mistakes – but it’s best not to do that on your grant application. Here are some common mistakes to avoid: 

• Incomplete or inaccurate information – Check that your information is up-to-date and complete. 
• Missed deadlines – An application that misses the deadline will be automatically disqualified. 
• Ignoring guidelines – Many of these are there to help process the applications; follow them meticulously to avoid any issues. 
• Lack of clarity – Don’t waffle and make sure your business goals, plans, and expected outcomes are well identified. 
• Missing supporting documentation – You have taken time to prepare all the necessary documentation so don’t forget to attach it all. 

Small Business Grant Support from Cashflow Solutions 

Our advisors at Cashflow Solutions are here to help you get funding for your small business. Our team are experienced in finding the best grants, loans, and capital investment for businesses across the UK. Why not speak to us today for more help and support? 

Working in partnership with our lending partners backed by the British Business Bank to deploy funds to support business growth and working capital

• Our connections to funders are second to none.
• We will use our experience to select the right lender to approach on your behalf
• We conduct diligence on each application before it goes – we like to answer the lenders questions before they ask them.
• We will produce a short credit paper which will go alongside your application.
• We can produce the cashflow for you in a format that will be acceptable to the lender
• We will ensure that your application is supported by all the key documents needed – if you make it easy for the lender it will cut days off the process and increase your chances of approval.