Discretionary Grants Scheme
Application window closed
The Discretionary Grant Scheme application window has now closed. We are processing applications and expect to start making payments within 14 days.
The government has delivered an initial package of support for small businesses through the Small Business Grant Fund and the Retail, Leisure and Hospitality Grant Fund for which eligibility was calculated via business rates payments.
Recognising that many severely impacted businesses were excluded from these grants, an additional Discretionary Grants Scheme has been launched. This is aimed at small businesses that did not qualify for one of the previous schemes and that have ongoing property-related costs.
The awards will be split between market traders (10 per cent or £368,000) and all other qualifying small local businesses and charities (90 per cent or £3.3m).
Please note that a lot less money is available through this scheme than through previous programmes. This means difficult decisions have had to be made about allocating resources, and we will not be able to help every business in need.
It is important that you read all the information on this page if you think you qualify before you submit an application for the grant.
Applications will open at midday on Monday 15 June 2020 with a link to the form on this page. The closing date for applications is at midday on Monday 6 July 2020.
Who is the scheme aimed at?
The main aim of the scheme is to reach small and micro businesses who were not eligible for the Small Business Grant Fund or the Retail, Leisure and Hospitality Fund, because they were not direct ratepayers.
Government guidance states that the discretionary grants are mostly aimed at:
- Small and micro businesses, as defined in Section 33 Part 2 of the Small Business, Enterprise and Employment Act 2015 and Companies Act 2006
- Businesses with relatively high ongoing fixed property-related costs.
- Businesses which can show they have suffered a significant fall in income due to the COVID-19 crisis.
- Businesses which occupy property or part of a property, with a rateable value or annual rent or annual mortgage payments below £51,000.
The council has some discretion to reflect local economic need and has set the following business categories to support in the discretionary scheme:
- Small and micro businesses in shared offices or other flexible workspace (excluding spaces within residential properties)
- Regular market traders with fixed building costs such as rent, trading in the first quarter of 2020, who do not have their own business rates assessment
- Local independent businesses in leisure and hospitality and usually open to visiting members of the public where the rateable value is over £51,000 and up to £65,000.
- Small and micro businesses whose income and turnover is directly related to the retail, hospitality and leisure sector. They must demonstrate in their application how their business is related to the retail, hospitality and leisure sector as outlined in the Retail, Hospitality and Leisure Grant fund.
- Childcare Ofsted registered nurseries with a rateable value less than £51,000.
- Charity properties that receive charitable business rates relief which would otherwise have been eligible for Small Business Rates Relief, having a rateable value below £15,000.
Which small and micro businesses are eligible?
To be classed as a small business you must have:
- a turnover of less than £10.2m
- a balance sheet total of less than £5.1m
- have less than 50 employees.
To be classified as a micro business you must have:
- a turnover of less than £632,000
- a balance sheet total of less than £316,000
- have less than 10 employees.
Businesses that have applied for the Coronavirus Job Retention Scheme or the Self-Employed Income Support Scheme (SEISS) can apply for this scheme.
Businesses must have been trading on 11 March 2020.
The grant funding is for businesses that cannot apply for other support schemes.
Businesses that have received cash grants from any central government coronavirus-related scheme (apart from SEISS) cannot apply for funding under the Discretionary Grants Scheme.
These other government schemes include:
- Small Business Grant Fund
- Retail, Hospitality and Leisure Grant
- The Fisheries Response Fund
- Domestic Seafood Supply Scheme (DSSS)
- The Zoos Support Fund
- The Dairy Hardship Fund.
- In the unlikely event the business has received a significant amount of public funding then EU State Aid limitations may apply.
- Self-employed individuals that work primarily from home and do not have additional ongoing, fixed building-related costs outside of their living property costs, will not be eligible for funding.
- Companies or individuals in administration, insolvent or where a striking off notice has been made are not eligible.
- Generally, businesses that have rateable value of £51,000 or more are not eligible. Businesses that do not pay business rates, must have annual rent or mortgage charges of less than £51,000.
How much money is available for local businesses?
The government has confirmed that Tower Hamlets will receive a total of £3,686,250 to be split between qualifying market traders (10 per cent or £368,000) and all other small local businesses (90 per cent or £3.3m).
The government has said that local councils will manage this scheme. They can use their judgement based on local economic need, but will also need to work within national guidelines.
Important note on the final grant amount
As the scheme may be oversubscribed, the suggested grant amounts that follow are subject to change and the final amounts may be less than those listed.
What level of funding is available?
Market traders are a significant and traditional part of our local economy and we want to support them with an award of 10 per cent of the total funding available.
To qualify for this payment, you must hold a current trading licence and have traded for a minimum of 8 weeks in the first quarter of 2020.
The grant available will be split between full time (4 days or more per week) and part time traders. Providing you meet the qualifying criteria the suggested award will be as follows:
- Full time Traders - £720
- Part time Traders - £360
Properties that get charitable business rates relief which would otherwise have been eligible for Small Business Rates Relief and having a rateable value below £15,000, will be awarded a suggested flat rate grant of £2,000.
In deciding if you qualify and what level of grants to pay, certain criteria will be considered including:
- amount of ongoing fixed costs
- number of employees
- whether the business has had to close completely
- continued trade online and the overall impact of COVID-19 losses.
Due to the limited funds available and the chance applications will be more than the funds available, the scheme will be open for a period of 3 weeks. All information supplied will be assessed and awards will be based on the level of ongoing business-related spending.
The most you can receive under the Discretionary Scheme is £10,000 if you can show proof of ongoing business-related costs in your application.
Once qualifying criteria are established and the case identified for payment, the amount will be based on the level of ongoing building-related costs.
Most awards will be paid for the suggested sums in the following table. The scheme will allow for payments of smaller sums and all award amounts are subject to change if the scheme is oversubscribed.
|Ongoing building related costs (pa) ||Suggested grants |
up to £10,000
£10,000 to £14,999
up to £7,000
£5,000 to £9,999
up to £5,000
Up to £4,999
up to £2,500
The sliding level of payments will help more businesses receive support and target those with higher ongoing fixed building costs.
To ensure that the Discretionary Grant reaches those businesses most in need, this policy will be reviewed by the Chief Finance Officer two weeks after launch.
After this period, the council reserves the right to modify eligibility criteria and funding limits, to ensure fairness and prevent awards exceeding the amount of funding available.
The application process
Evidence to support applications
Evidence will be captured alongside the application and eligibility checks will be made before any award. This will include:
- Copies of lease/rental agreements (for all commercial tenants)
- Copy of your current Market Trading licence (for market traders)
- Copies of bank statements going back to 1 January 2020 showing ongoing payments to landlords.
- Evidence to support a significant fall in income of at least 25 per cent due to COVID-19 with copies of bank statements showing comparisons for the previous year.
- The business must be registered in and have a principle trading address within the London Borough of Tower Hamlets area. A copy of a document from HMRC showing these details must be submitted.
- The business must not be in receipt of one of the government grants listed in the exceptions section.
There is no statutory right of appeal against a decision regarding discretionary grants made by the council.
To ensure that the Discretionary Grants Scheme is not subject to potential abuse, all submitted applications will require a statutory declaration of truth, a statement regarding data processing and a recovery of funds statement.
This declaration allows the council, through the corporate anti-fraud team, to carry out pre-payment checks. This gives greater assurances that the funds are being claimed correctly.
The declaration carries warnings which further allow the council to consider taking criminal action against persons who have been found to have deliberately made false applications for the funding. It also allows for the recovery of funds which have been paid which should not have been.
The application form will include a statement that checks will be made against other council databases and to independent sources. Data required will include company registration, websites and VAT numbers to help with pre-validation checks.