Further to the budget earlier this week, below is a summary of the key points that may affect you.

Restart Grants

Shops can apply for up to £6,000 grant to reopen on April 12, while hospitality and leisure businesses could get up to £18,000.

A Restart Grant worth up to £18,000 for the largest businesses will help shops, pubs, hotels and any other small business through to June 21, when it’s hoped the final coronavirus restrictions will be lifted.

Where to find your Restart Grant

The Restart Grant scheme, administered by local councils, will help almost 700,000 small business owners including those running shops, pubs, clubs, hotels restaurants, gyms and hair salons. Non-essential retail businesses will get up to £6,000 per premises through the Restart Grant scheme to help them reopen. Shops will reopen no earlier than April 12, according to the Government’s Covid-19 roadmap. More Restart Grant money will be available for any small business in hospitality, accommodation, leisure, personal care and gyms, which will reopen later and will be more affected by restrictions. They can receive up to £18,000, depending on their rateable value.

Budget 2021 and what it means for small business

As expected, Chancellor Rishi Sunak has extended furlough until September, launched a Help to Grow digital training and grants scheme aimed at small business and extended self-employed Covid-19 financial support to a further 600,000 people.

In total, the extensions to furlough, self-employed support, business grants, loans and VAT cuts will bring total Covid-19 fiscal support to over £407bn.

Small business exempt from corporation tax hike

Any small business with profits of £50,000 or less will be exempt from the corporation tax increase to 25 per cent from 2023. This means that around 70 per cent of companies will be exempt from the corporation tax hike. A tapered rate will also be introduced for profits above £50,000, so that only businesses with profits of £250,000 or greater will be taxed at the full 25 per cent rate. As a firm, we will be reviewing every limited company we act for over the next 12 months to assess the potential impact on you if any. We have time on our side, so we will be able to plan.

Help to Grow scheme

Around 130,000 small and medium sized businesses will be supported through the new Help to Grow scheme, which will provide the digital and management tools and training. Any small business can apply for a £5,000 grant to pay for Government-approved productivity software.

Self-Employment Income Support Scheme

Self-Employment Income Support Scheme (SEISS) will continue with a fourth and a fifth grant. The Chancellor announced that more than 600,000 people, many of whom became self-employed in 2019-20, may now be able to claim direct cash grants under SEISS. However, self-employed company directors who pay themselves in dividends rather than PAYE were again excluded from support.

Recovery Loan Scheme

A new Recovery Loan Scheme will also be launched to replace the existing Government-guaranteed Covid-19 financial support schemes that have supported £73bn of lending to date and close at the end of March. The Recovery Loan Scheme is scheduled to run until December 31 2021, but this is subject to review. Details of the scheme include:

  • Up to £10m facility per business:  The maximum value of a facility provided under the scheme will be £10m per business. Minimum facility sizes vary, starting at £1,000 for asset and invoice finance, and £25,001 for term loans and overdrafts
  • Turnover limit: There will be no turnover restriction for businesses accessing the scheme
  • Wide range of products: Businesses will be able to choose from a variety of products: term loans, overdrafts, asset finance and invoice finance facilities
  • Term length: Term loans and asset finance facilities are available for up to six years, with overdrafts and invoice finance available for up to three years
  • Interest and fees to be paid by the business from the outset: Businesses will be required to meet the costs of interest payments and any fees associated with the facility
  • Access to multiple schemes: Businesses who have taken out a CBILS, CLBILS or BBLS facility will be able to access the new scheme, although the maximum they are allowed to borrow will depend on their lender’s assessment and scheme requirements
  • Credit checks for all applicants: Lenders will be required to undertake credit and fraud checks for all applicants. When making their assessment, lenders may overlook concerns over short-to-medium term performance owing to the pandemic. The checks and approach may vary between lenders

Super-deduction tax break for investment

Mr Sunak also announced a “super deduction” tax break for companies investing in new equipment beginning April 2021. This is effectively a First Year Allowance on capital investment, but there are restrictions (e.g. it doesn’t apply to cars so please don’t rush out and by a Range Rover!)

Business rates holiday

The business rates holiday in England has been extended by an additional three months. That means 750,000 retail, hospitality and leisure properties in England will pay no business rates for three months from April 1 when combined with Small Business Rates Relief, with further relief available for the rest of the year.

Reduced VAT for tourism and hospitality

The Government has extended the temporary 5 per cent reduced rate of VAT until September 30 2021. To help businesses manage the transition back to the standard rate, a 12.5 per cent rate will then apply for a further six months, until 31 March 2022.

The above is an overview of the main headlines and as ever devil will be in the detail as it is released.