Top UK grants for small businesses and startups in 2023

Small business grants and startup business grants are financial assistance that do not require repayment and are typically designated for specific purposes or projects, including training, employment, expansion, research, renovations, or the revitalization of local areas.

Each small business grant is accompanied by unique guidelines and eligibility criteria, often involving an application process due to the competitive nature of business funding.

The number of UK business grants frequently changes as new schemes are introduced and old schemes expire. As well as UK business grants, there may also be regional business grants for your business. You can check for the most up-to-date funding options at your local business hub, the government’s business funding search tool, and your dedicated sector organisations.

Various types of business loans and grants are accessible in the UK, each tailored to specific objectives. These include:

Direct Grants: Direct grants involve providing financial assistance straight from relevant grant provider to a business for the purpose of funding a specified project. Typically, these programs involve fund matching, which requires you to contribute half of the necessary funds, which will then be matched by the grant funding.

Resource and Training Grants: For those community groups seeking to enhance knowledge or gain access to resources and expertise for project initiation, the following resource and training grants are available:

Innovation Vouchers: These vouchers, offered by the uk government through Innovate UK, extend up to £5,000 to cover costs related to an external expert or consultant assistance. They prove beneficial for startups and established SMEs involved in research and innovation.

Local Business Support: Local authorities often provide business support grants to facilitate training workshops, expert insight, business boosters, and other forms of training.

Business Support Networks: Business owners, including former ones, can serve as valuable sources of expert guidance. Business support networks enable peer-to-peer advice, particularly advantageous for businesses engaged in emerging technologies or best-practice initiatives.

Business Support Helplines: Government-backed schemes provide advice and financial support to businesses. These include assistance with taxation, exporting, and creating business plans.

Tax Relief: To ease the tax burden on small businesses, the government has established several schemes:

National Insurance Relief: Businesses with employees may be eligible for National Insurance relief of up to £4,000. However, this relief is allocated per business, not per employee. It is unavailable to limited companies with a single director and no other staff.

Business Rates Relief: Businesses operating in a single property with a rateable value under £15,000 could be eligible for business rates relief. Specifically, retail, hospitality, and leisure sectors have been granted a 50% discount on business rates for a year as part of ongoing COVID recovery measures.

Employment Allowance: This initiative enables the reduction of national insurance contributions for staff by up to £5,000 annually.

Corporation Tax Relief: The main Corporation Tax rate stands at 25% as of April 2023 (increased from 19%), ‘Marginal Relief’ is available for businesses with taxable profits below £50,000. This entails a gradual increase between the small profit rate (19%) and the main rate. If your profits fall between £50,000 and £250,000, you may qualify. Refer to the uk government website for specifics on allowances and reliefs.

In the UK, there is a variety of start-up business grants to help give businesses the kick-start on their business journey, these include:

Elmbridge Start-up Boost: Start-ups in Elmbridge, Surrey, can apply for a one-off grant worth a maximum of £1,000 to cover 50% of eligible costs related to getting your business off the ground.

Hertfordshire Start-up Programme (HSUP): If you are hoping to start a new business in Hertfordshire, you may be eligible for 12 hours of free business support, worth £1,400.

Malvern Hills Enterprise Scheme: If you are a new or young business in the Malvern Hills district, in Worcestershire, there are grants of £500 to £1,000 available if you meet the scheme’s criteria.

Mansfield Business Start-Up Grant: If you are looking to start a new business in the Mansfield district, you may be eligible for a grant worth up to £2,500.

Reigate & Barnstead Borough Council Business Support Grants: Start ups in the Reigate and Barnstead area with fewer than four employees can apply for a grant worth up to £1,000. This grant is also available to existing businesses.

Scarborough Business Development Grant Scheme: Start up business grants of up to £1,000 are available in the Yorkshire town of Scarborough for new businesses and those trading for less than 18 months.

West Midlands SME Grant Programme: New businesses in the West Midlands region can apply for a grant worth between £2,500 and £7,500.

Worcester City Council Business Start-up Grant: If you are based in Worcester, and are at the start up stage or have been trading for less than 12 months, you can apply for funding from the City Council. If you are working from home, you can apply for a grant worth £1,000, while if you are in commercial premises, the grant is worth £2,000.

Startup loans, which are government-backed unsecured loans used to raise money to initiate or expand businesses, and startup grants offer financial support for various business requirements.

Here are some of the presently accessible startup grants:

The Prince’s Trust

Extends grants to individuals aged 18 to 30 aspiring to establish and manage their own enterprises. This trust also supplies mentoring, training, and other valuable resources.

New Enterprise Allowance

Offers funds for initiating or advancing a business, albeit with certain conditions:

You must be 18 years or older.

Either you or your partner should be receiving Universal Credit, Job Seeker’s Allowance, or Employment and Support Allowance, or you must be a lone parent, ill, or disabled and receive Income Support.

As a component of the 2021 Autumn Budget, the Chancellor unveiled plans to inaugurate a £150 million “angel investors” fund, aimed at fostering the launch of additional startups outside of London. Further insights on angel investors can be found in our guide to locating the right investor for your business.

Grants for Young Entrepreneurs

In addition to The Prince’s Trust, various grants are accessible for individuals aged 18 to 30 who aspire to establish their own businesses, including:

UnLtd

Offers grant funding and support for social entrepreneurs driven by the pursuit of social change.

Shell LiveWIRE

Facilitates access to knowledge, skills, networks, and resources to help young individuals actualize their business aspirations, foster job creation, generate sustainable income, and drive innovation.

Grants for Businesses with Apprentices

Government grant funding is available to cover apprenticeship training, assessment, and other expenses. If your business is subject to the Apprenticeship Levy, a grant is allocated for your apprenticeship training and assessment, with an additional 10% contribution from the local authority or government.

For non-Levy-paying businesses, you contribute 5% towards training and assessment costs, while the government covers the remaining 95% up to a specified funding ceiling. This payment is directed to the training provider, and you’ll arrange the direct payment of your 5% share.

Grants for Women

Recognizing the disparity in grant funding for male-owned businesses, organizations are increasingly focusing on funding women entrepreneurs, striving to level the playing field for their success. Explore our guide on grants for female entrepreneurs to discover small business grants tailored specifically to create jobs for women.

Geographically-based Grants

Depending on your business’s location, you might be eligible for grants or assistance linked to your region’s initiatives. Many counties allocate resources to initiatives that stimulate job growth or support graduates. Investigate whether your area offers any applicable schemes or initiatives that align with your own small business goals. For instance, Mansfield in Nottinghamshire offers specialized small business start-up grants for the region.

Trade-specific Grants

Your industry affiliation might entitle you to targeted support, such as grants, training, or workshop access tailored to benefit your business. For instance, specialized UK food and beverage manufacturers could secure up to 25% funding towards production costs through the FEAST2 scheme. Refer to government resources to ascertain if your sector qualifies for additional assistance.

Grants for Energy-efficient Workspaces

Government incentives and grants cater to environmentally conscious business owners focused on enhancing workplace energy efficiency and reducing carbon emissions. If a refurbishment business plan is on the horizon, opting for environmentally friendly practices could render you eligible for business funding. For instance, the government could provide up to £6,500 in support. Note that these grants might be region-specific, with some UK counties initiating projects to decarbonize their areas.

Tips for Grant Application Success

Contact the Awarding Body Before Applying: Establishing contact with the awarding body can be advantageous, especially if any issues impede your application progress. Having a point of contact familiar with your business can offer insights and guidance on the process.

Apply Early: Submit your application as soon as feasible. Early submissions encounter less competition, increasing your chances of success.

Consider a Consultant: If you lack the time to monitor upcoming grants or navigate the current landscape, a grant consultant can assist you. They possess expertise in application strategies, tracking, and communication with awarding bodies, potentially aiding in securing the required funds.

Understand Grant Objectives: Thoroughly comprehend the grant’s objectives and ascertain your business’s compatibility with its requirements. You must substantiate your need for funding, how it will be utilized, and align with the grant’s stipulations.

Every business grant, whether targeted at small businesses or start-ups, comes with its unique application process. Nonetheless, there are overarching steps you can take to enhance your prospects of submitting a successful application.

Conduct Thorough Research: Gain a precise understanding of the grant provider’s requirements to tailor your application effectively. This prevents wasting time on unsuitable grants and enhances your alignment with suitable opportunities.

Apply Promptly: Most grants have an expiry date, so an early application could help your chances of success.

Be Mindful of Deadlines: Don’t risk missing out on small business grants due to overlooked application deadlines. Maintain a record of submission dates and any subsequent stages.

Emphasize Clarity: Whenever possible, steer clear of intricate jargon and excessively convoluted language. Strive for simplicity and clarity in your proposal to facilitate understanding.

Provide Specifics: Not only should you detail your business’s nature and eligibility compliance, but also specify the intended use of the grant funds and the desired outcomes you seek to attain.

Thoroughness Matters: Furnishing a comprehensive business plan can greatly substantiate your case for receiving a grant. In certain instances, it might even be an application prerequisite.

The government has introduced further schemes to help businesses with the rising cost of living and business energy bills. Additional support for 2023 includes:

Aside from grants, there are various other government schemes that can help with funding and business costs in 2023, including:

Energy Bill Relief Scheme – This scheme provides a discount on business energy bills for six months from October 1, 2022. To find out more about the scheme and to see if your business qualifies, check out our guide Does the energy price cap apply to businesses?  

Energy Bills Discount Scheme – The EBDS, is a continuation of EBRS placed in to protect businesses against severe energy price increases and therefore, strikes a balance between supporting businesses over the next 12 months and limiting taxpayers’ exposure to volatile energy markets, with total uk government support set at £5.5 billion.

It will provide a discount on eligible business gas and business electricity contracts from 1st April 2023. Find out more in our guide to the Energy Bill Discount Scheme.