Posted on Oct 20, 2020 in Insolvency & Restructuring by Pamela Muir
Following on from our Article ‘Chancellor Announces fresh support for Businesses if they are told to Shut down’ posted on 9 October 2020, the Scottish Government has announced details for their funding support available to struggling Scottish businesses affected by the recent coronavirus trading restrictions.
The Treasury had previously stated that the devolved administrations in Scotland, Wales and Northern Ireland would receive increased funding allowing them to bring in similar measures to the business grants that have since been made available in England. Here is what we know so far with regards to funding support available for Scotland.
When is the Scottish Government funding support available?
Funding support is only available between 20 October 2020 and 3 November 2020.
What funds are available?
There are two funds available. The Business Closure Fund and the Discretionary Business Hardship Fund.
The Business Closure Fund pays grants for businesses that have been forced to close as a result of the new restrictions.
The Discretionary Business Hardship Fund pays grants for businesses that have not been forced to close but are suffering significant hardship due to the new restrictions or being forced to run their businesses subject to restrictions.
How much funding is available?
The Business Closure Fund’s grant:
- £2,000.00 for those with a rateable value of up to and including £51,000.00;
- £3,000.00 for those with a rateable value of £51,001.00 and over;
- If a business has multiple premises that have been forced to close, it can subsequently claim multiple grants to a maximum total of £15,000.00.
Discretionary Business Hardship Fund’s grants:
- £1,000.00 if their premises has a rateable value of up to and including £51,000.00;
- £1,500.00 if their premises has a rateable value of £51,001.00 and over;
- If a business has multiple premises that have been affected, then it can claim multiple grants. Here the maximum total available is £10,000.00.
Priority to certain sectors
The Scottish Government has advised that priority will be given to certain sectors; mainly hospitality businesses or gyms that, as a result of the new regulations, are forced to operate in a restricted way and crucially those that are able to evidence at least a 25% reduction in turnover from 9 to 25 October 2020.
Priority is also provided to producers and wholesale businesses based in Scotland supplying short span goods or produce to hospitality businesses affected by the regulations and again crucially, those whose turnover had dropped by a minimum of 25% during the shutdown period to be allowed to claim.
To be eligible for either fund, your business must:
- Have been open and trading before 9 October 2020;
- Have a business bank account;
- Have premises registered for Non-Domestic rates. Businesses that pay rates through their landlords rather than directly to a council are eligible to apply (you must provide a copy of your lease agreement as evidence).
Your business is not eligible if it has:
- Breached wider COVID regulations/requirements prior to local restrictions;
- Connections to tax havens, as set out in the Coronavirus (Scotland) (No.2) Act 2020;
- Provides takeaway food as its main operation.
How do I apply?
You can apply through your local council website. Please be reminded that additional grants are only available from 20 October 2020 and 3 November 2020 so businesses are advised to act quickly and without delay to secure available funds for those businesses that qualify.
This note is based on information as at 19 October 2020 and will be updated as and when further information is provided.
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