Funding sources to support businesses in Scotland facing coronavirus
If you have applied for a grant through your local council, you need to contact them for an update. Our enquiries team have no access to their systems.
Self-employment Income Support Scheme
The scheme is now closed to new claims for the first grant.
The scheme has been extended. If you were eligible for the first grant and can confirm to HMRC that your business has been adversely affected on or after 14 July 2020, you’ll be able to make a claim for a second and final grant from 17 August 2020.
You can make a claim for the second and final grant if you’re eligible, even if you did not make a claim for the first grant.
If you’re eligible the second and final grant will be a taxable grant worth 70% of your average monthly trading profits. The grant will be paid out in a single instalment covering a further 3 months’ worth of profits. The second grant is capped at £6,570 in total.
Find further guidance on GOV.UK (28 July 2020)
Am I eligible?
To be eligible for the scheme you must meet all of the criteria below:
- Be self-employed or a member of partnership
- Have lost trading/partnership trading profits due to COVID-19
- File a tax return for 2018-19 as self-employed or a member of a trading partnership. Those who have not yet filed for 2018-19 will have an additional 4 weeks from this announcement to do so
- Have traded in 2019-20; be currently trading at the point of application (or would be except for COVID 19) and intend to continue to trade in the tax year 2020 to 2021
- Have trading profits of less than £50,000 and more than half of your total income come from self-employment. This can be with reference to at least one of the following conditions:
- Your trading profits and total income in 2018/19
How your circumstances can affect your eligibility for the scheme (3 August 2020)
What can I claim?
- The scheme will provide a grant to self-employed individuals or partnerships, worth 80% of their profits up to a cap of £2,500 per month
- HMRC will use the average profits from tax returns in 2016-17, 2017-18 and 2018-19 to calculate the size of the grant
- The scheme will be open to those where the majority of their income comes from self-employment and who have profits of less than £50,000
- The scheme will be open for an initial three months with people able to make their first claim by the beginning of June
How to apply for a grant
- Individuals should not contact HMRC now. HMRC will use existing information to check potential eligibility and invite applications once the scheme is operational. HMRC will then pay the grant directly to eligible claimants’ bank account.
- Note: When invited to apply, you will access this scheme only through the GOV.UK. If someone texts, calls or emails claiming to be from HMRC, saying that you can claim financial help or are owed a tax refund, and asks you to click on a link or to give information such as your name, credit card or bank details, it is a scam.
Other support for the self-employed
If you're self-employed, you are not eligible to receive statutory sick pay (SSP)
If you're self-employed and not claiming any benefits, you may be entitled to claim Employment and Support Allowance (ESA) or Universal Credit.
If you're self-employed and already claiming Universal Credit and have to stay at home due to coronavirus, you will not have a Minimum Income Floor (an assumed level of income) applied for a period of time while affected.
If you're self-employed and concerned you'll be unable to pay your tax, you may be eligible to receive support through HMRC’s Time to Pay service. However, arrangements are agreed on a case-by-case basis to account for individual circumstances and liabilities. (26 March 2020)
You can contact HMRC’s dedicated COVID-19 helpline on 0800 0159 559.
If you are between 18 and 30 years of age
The Prince’s Trust and NatWest have released a £5 million fund offering grants to self-employed people aged 18-30.
Register your interest via The Prince’s Trust website
If you have coronavirus (COVID-19) symptoms
You will be considered unfit for work if:
- have coronavirus symptoms and are staying at home, according to government guidance
- if you're staying at home, or 'self-isolating', because you've been in contact with someone with coronavirus (COVID-19)
Claiming sick pay
You will be able to claim statutory sick pay (SSP) if you’re employed on a zero hours contract and earn over £118 per week.
If you have to take time off work due to the coronavirus (COVID-19) and you don’t get paid while you’re off, you may be entitled to claim government benefits.
Citizens Advice suggest that if you already receive benefits, such as Tax Credits or Housing Benefit you should speak to the office paying you and explain that you are unable to work due to illness.
Citizens Advice notes that you may be entitled to more money while you’re off.
Grand funding
The Sustainable Innovation Fund: round 1 (temporary framework) (29 June 2020)
UK registered businesses can apply for a share of up to £55 million for new projects focusing on sustainable economic recovery from COVID-19. Total eligible costs must be between £100,000 and £500,000.
This competition is round 1 of a potential 3.
- Round 1 – Temporary framework (this competition)
- Round 2 - De Minimis (opening July 2020)
- Round 3 - Temporary Framework (opening September 2020)
Each organisation working alone or in a collaboration can claim a maximum of £175,000 (80% intervention rate). Closes 11am, Monday 29 July 2020.
SBRI contract
The Sustainable Innovation Fund: SBRI phase 1 (29 June 2020)
Organisations can apply for a share of up to £10 million, including VAT, to help UK businesses and the public sector recover from COVID 19 in a sustainable manner.
To lead a project, you can be an organisation of any size. Contracts will be awarded to a single legal entity only.
You must engage with potential future customers to ensure that the product or service being developed is realistic, scalable and accommodates end user requirements and feedback. We expect projects in this phase to range in size up to total costs of £60,000, including VAT. Closes 11am, Wednesday 5 August 2020
Other innovation competitions
Small and medium-sized businesses affected by coronavirus (COVID-19) can apply for a loan of up to £50,000 which will be guaranteed by the UK Government (4 May 2020)
Apply for a coronavirus Bounce Back Loan.
The scheme has been designed to ensure that small firms, who need a vital cash injection to keep operating, can get finance in a matter of days.
Features:
- no forward-looking tests of business viability
- simple eligibility criteria
- a quick, standard form
- most firms should receive the loan within 24 hours of approval
- the UK Government will pay the interest for the first 12 months
- the UK Government will guarantee 100% of the loan
- it will be capped at £50,000
COVID Working Capital Loans of between £25,000 and £100,000 are being offered by Business Loans Scotland (BLS) under the Scottish Growth Scheme.
These loans are aimed at small and medium-sized businesses (SMEs) in Scotland to help fund working capital and cashflow needs during the coronavirus (COVID-19) crisis.
The loans are available in addition to other Government grant and loan schemes.
They offer an initial three-month interest and capital repayment holiday and a fixed interest rate of 6%.
The following types of legally formed and trading businesses are eligible:
- Limited companies
- Partnerships, including limited liability partnerships (LLPs), with four or more partners
- Partnerships, including limited liability partnerships (LLPs), with three or fewer partners (loans over £25,000 only)
- Sole traders (loans over £25,000 only)
The main focus is on businesses engaged in the business-to-business (B2B) and business-to-consumer (B2C) categories.
Businesses must prove they were viable and not in financial difficulty on 31 December 2019.
They should also have previously applied for a Bounce Back Loan or Coronavirus Business Interruption Loan.
You can apply online on the BLS website.
About the scheme
Check if you can claim for your employees' wages through the Coronavirus Job Retention Scheme (3 August 2020)
Check which employees you can put on furlough through the Coronavirus Job Retention Scheme (7 August 2020)
The final date you could furlough an employee for the first time was Wednesday 10 June.
However, people on paternity and maternity leave who return to work in the coming months will be eligible for the government’s furlough scheme. (9 June)
The UK Job Retention Scheme (furlough) that pays 80% of wages of workers on leave because of coronavirus has been extended by a further four months to October (backdated from 19 March). The UK Government will ask companies to "start sharing" the cost of the scheme from August. (12 May 2020)
Instead of making employees redundant, employers can furlough employees and apply for a grant that covers:
- 80% of their usual monthly wage costs, up to £2,500 a month, plus
- the associated Employer National Insurance contributions, and
- pension contributions (up to the level of the minimum automatic enrolment employer pension contribution) on that subsidised furlough pay
How does it work?
Read this step-by-step guide for employers which tells you what information you need to gather before you apply. (2 July 2020)
Find out how to calculate 80% of your employee’s wages, National Insurance contributions (NICs) and pension contributions if you've furloughed staff. (3 August 2020)
Am I eligible?
You can check if you can claim for support. Employers with employees on the payroll at 19 March 2020 who have subsequently put them on furlough can make a claim. (3 August 2020)
How to apply
Make your claim through the UK Government site (7 August 2020)
Overclaimed?
How to pay all or some of your grant back if you’ve overclaimed through the Coronavirus Job Retention Scheme (1 July 2020)
The Job Retention Bonus is a one-off payment to employers of £1,000 for every employee who they previously claimed for under the Coronavirus Job Retention Scheme, and who remains continuously employed through to 31 January 2021.
Eligible employees must earn at least £520 a month on average between the 1 November 2020 and 31 January 2021.
Employers will be able to claim the Job Retention Bonus after they have filed PAYE for January. Payments will be made to employers from February 2021.
Find out more about the Job Retention Bonus, including eligibility, which employees you can claim for and how to get the bonus.
About the scheme
Small businesses can now apply for the Coronavirus Business Interruption Loan Scheme (CBILS). They have changed eligibility criteria to make it easier for businesses to access funds.
The British Business Bank offers the Coronavirus Business Interruption Loan Scheme (CBILS) which started accepting applications on 23 March.
This provides facilities of up to £5 million for smaller UK businesses experiencing lost or deferred revenues, leading to disruptions to their cashflow.
CBILS supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance. The scheme provides the lender with a guarantee backed by government, potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’. The borrower always remains 100% liable for the debt.
Updates to the Scheme on 3 April 2020
- No personal guarantees for facilities under £250k
- Personal guarantees for facilities above £250k capped at 20% of outstanding balance
- Insufficient security is no longer a condition to access the scheme, opening up access to business who would previously have met requirements for a commercial facility and as such been ineligible for CIBLS
The first two changes will be administered retrospectively by lenders. Any companies who believe they have been rejected for a CIBL loan previously as they did not meet requirements in third bullet are encouraged to re-contact their lender.
Read the CBILS press notice (PDF, 119kB)
Am I eligible?
To be eligible for support, your business must be:
- based in the UK
- with turnover of no more than £45 million per year
- considered capable to trade out of any short-to-medium term difficulty with financial support via the lender
Find more details about CBILS using the following links:
- Coronavirus Business Interruption Loan Scheme factsheet (PDF, 66kB)
- Frequently Asked Questions (FAQs) about CBILS for businesses
- The application process - infographic
- Are you eligible checklist to help you understand if you can apply
How does it work?
CBILS is provided through a wide range of lenders and partners, offering more attractive terms for both businesses applying for new facilities and lenders.
CBILS provides the lender with a partial guarantee (80%), backed by government, against the outstanding facility balance, subject to an overall cap per lender.
The government will also cover the first 12 months of interest payments, so businesses will benefit from lower initial repayments.
How to apply
To apply for finance under the scheme, you should approach a lender directly.
Different lenders provide different types of finance. Here is a list of all lenders available in Scotland, who offer different types of finance.
Term loans
- Bank of Scotland
- Barclays
- Calverton Finance
- Clydesdale Bank
- Compass Business Finance
- County Asset Finance
- DSL Business Finance
- Hitachi Capital Business Finance
- HSBC
- Lloyds Bank
- Metro Bank
- NatWest
- Royal Bank of Scotland
- Santander
- UKSE
Asset finance
- Aldermore
- Arkle Finance
- Compass Business Finance
- County Asset Finance
- Haydock Finance
- Hitachi Capital Business Finance
Invoice finance
Overdraft (revolving credit)
About the scheme
All viable businesses with a turnover of more than £45 million will be able to apply (16 April 2020).
Find full details on the British Business Bank website
How does it work?
The Coronavirus Large Business Interruption Loan Scheme will be delivered through regular commercial lenders, at commercial rates of interest.
Borrowers under CLBILS will be able to borrow up to 25% of turnover, up to a maximum of £200 million.
Lenders who wish to offer larger loans will need to undergo further accreditation checks.
The government will provide an 80% guarantee on individual loans to give lenders the confidence to support businesses that have been unable to secure financing from regular sources.
Lenders will conduct the usual credit checks, but will make allowances for businesses that were viable before the coronavirus crisis but are experiencing short to medium-term difficulties now.
Businesses will be responsible for repaying any loan they receive under the CLBILS scheme.
Am I eligible?
To be eligible for support, your business must be:
- based in the UK
- turning over between £45 million and £500 million
- unable to secure regular commercial financing
- viable, were it not for the coronavirus pandemic
- experiencing short- to medium-term difficulties that you will be able to trade out of with financial support
How to apply
Find details on how to apply on the British Business Bank website
As well as accessing the Coronavirus Business Interruption Loan Scheme, your business bank can potentially help with other financial support. Here’s a list of the support available from the major business banks.
The Future Fund will issue convertible loans between £125,000 to £5 million to innovative companies which are facing financing difficulties due to the coronavirus outbreak.
The scheme is delivered in partnership with the British Business Bank and:
- has an initial commitment of £250 million of new government funding
- offers government loans ranging from £125,000 to £5 million to UK-based companies
- is unlocked by private investment on a match funded basis
- is for businesses who typically rely on equity investment and have raised at least £250k equity investment in the last 5 years
- is for businesses unable to access the Coronavirus Business Interruption Loan Scheme
- is an investor led scheme and it is the investor who must create an account and apply at the online portal
Find full details on the British Business Bank website
Creative Scotland
Funding programmes designed to provide further support to sustain the country’s creative community during the COVID-19 outbreak:
- The Performing Arts Venues Relief Fund is a targeted £10 million fund to support Scotland's performing arts venues. It will help venues who cannot yet reopen to their audiences due to the ongoing impact of coronavirus (COVID-19).
- The Creative Scotland Bridging Bursary Fund is for freelance artists and freelance creative practitioners working in the not-for-profit sector in Scotland, who are experiencing financial difficulty brought on by the coronavirus pandemic. This fund has been extended due to high demand.
- The Open Fund: Sustaining Creative Development will provide support for individuals and organisations to sustain their creative development in the coming months
Screen Scotland
Screen Scotland has announced details of support on offer for the screen sector.
- The Screen Scotland Bridging Bursary Fund for freelance or self-employed screen practitioners who have lost income from their work due to COVID-19
- Scotland’s independent film and TV production companies can apply for newly ring-fenced development support of between £3,000-£50,000 to develop creative and ambitious projects over the next 3-6 months
Museums Galleries Scotland
Two funding programmes to help Independent Accredited museums affected by the coronavirus (COVID-19) outbreak:
- The Urgent Response Fund will help cover urgent core costs for a maximum of 3 months. They will provide grants of between £3,000 and £60,000.
- The Digital Resilience COVID-19 Fund will cover up to £3,000 to buy equipment and software to help with digital working during this period of closure.
The Heritage Emergency Fund
Applications open for funding from £3,000 to £50,000. It should be used to support immediate actions and essential costs required to stabilise operations and manage unforeseen risks.
Applications close on 30 June 2020.
Wellbeing Fund
Apply for the Wellbeing Fund if you're a third sector organisation based in Scotland providing important coronavirus services for the community. (5 May 2020)
Funds can support the purchase and delivery of food, activities to support people’s mental health and wellbeing, co-ordination of local activity and staff and volunteer expenses.
Third Sector Resilience Fund
The Third Sector Resilience Fund is part of the £350 million support package announced by the Scottish Government. (8 May 2020)
This Fund will support organisations across the third sector who are at risk of closure due to disruption caused by COVID-19. The main intention of the fund is to help these organisations to stabilise and manage cashflows over this difficult period.
The Fund, delivered by SIS, Firstport and Corra Foundation, will provide grants between £5,000 and £75,000, as well as fully flexible, 0% interest loans starting at £50,000.
As part of this package, people most at risk from the impacts of the coronavirus outbreak are to receive further support following emergency investment in crucial services.
Charities Scottish Women’s Aid, Social Bite and other key partners will share up to £8 million to provide an emergency response and ensure services can react to coronavirus (COVID-19).
Community Response, Recovery and Resilience Fund
Foundation Scotland has announced funding is available between £1,000 and £5,000 for immediate community needs.
The RRR Fund will support local charities and grassroots organisations across Scotland to help them respond to the outbreak of the coronavirus pandemic and recover from its impact.
Only constituted groups, with a governing document, can apply.
Read the fund's guidance notes before you apply
Apply via the Foundation Scotland website
Other sources of help
Find support and funding options on the Coronavirus Third Sector Information Hub via the Scottish Council for Voluntary Organisations (SCVO)
Read their Frequently Asked Questions (FAQs) page. This site is continually being updated so check back for the latest info.
Read GOV.UK guidance on managing your charity during the coronavirus outbreak (7 April 2020)
Learn from leaders in the social enterprise and third sector, as they share their thoughts on how to navigate through these unprecedented times. These webinars are run by Social Investment Scotland.
Guidance for social care workers and employers about the Social Care Staff Support Fund (24 June 2020)
This guidance aims to ensure social care workers do not experience financial hardship if they are ill or self-isolating due to coronavirus.
Funding for early learning and childcare (ELC)
The Scottish Government has published a list of financial and business support that may be available to private and third sector childcare providers and childminders, depending on your individual circumstances. (30 July 2020)
All private and third sector providers who provide funded ELC in their settings will continue to receive payments from their local authority for these funded ELC hours.
Note: Local authorities will no longer be legally obliged to deliver 1140 hours of funded childcare from this August. This statutory requirement will be reinstated at an appropriate time in the future.
Your local authority will be in contact with you to confirm local arrangements of payments for funded ELC hours.
Aquaculture businesses affected by the collapse of international markets due to the coronavirus pandemic can apply to cover the costs of storing unsold stock. (23 June 2020)
A further £3.5 million to help large sea fishing vessels brings the total made available to the seafood industry by the Scottish Government from new and existing funds to £22.5 million. (17 April 2020)
The latest scheme will provide capped payments of up to £21,370 per vessel to businesses with a vessel over 12 metres landing shellfish such as crab, lobster, scallop and langoustine to help them meet fixed costs like insurance. It will also provide up to £42,740 for businesses operating more than one vessel. Amounts will be graduated by fleet segment and length category.
The Scottish seafood sector is to receive an initial package of more than £5 million in financial support to assist businesses during the coronavirus (COVID-19) outbreak. (25 March 2020)
Funding will be offered to over 650 seafood fishing companies, many of whom have lost their livelihoods with the collapse of export and hospitality markets for Scottish delicacies like langoustine, prawns and crab.
The Scottish Government has announced that support for coastal businesses and third sector organisations affected by COVID-19 is being made available through a £7.2 million Scottish Crown Estate fund. (11 April 2020)
Funding will be administered by local councils in coastal areas, with details of distribution to follow.
Recent announcements
Early Stage Growth Challenge Fund
The Early Stage Growth Challenge Fund is now closed for applications. This £25 million coronavirus (COVID-19) fund was provided by the Scottish Government to support early-stage, high-growth Scottish companies which have been negatively affected by the coronavirus (COVID-19) pandemic.
Support for housebuilders
The Scottish government has launched a £100 million emergency loan fund supporting small and medium-sized housebuilders with liquidity issues due to the temporary closure of the housebuilding sector as a result of COVID-19. (7 May 2020)
Other Scottish Government announcements
Economy Secretary Fiona Hyslop has confirmed that Scottish businesses will get £2.2 billion of support. To break this down, support includes:
- small firms receiving the Small Business Bonus Scheme (SBBS) or Rural Relief will be eligible for a £10,000 grant; or eligible for SBBS and in receipt of Nursery Relief, Disabled Relief, Business Growth Accelerator, Fresh Start Relief, Sport Relief, Enterprise Areas Relief or Charitable Rate Relief
- 12 months relief for businesses in hospitality, leisure, retail and aviation
- a £25,000 grant for retail, hospitality and leisure properties with a rateable value between £18,001 and £51,000
- effectively freezing the poundage rate next year
State aid rules and coronavirus
State aid rules still apply in the UK until the end of 2020.
The European Commission has announced a number of temporary State aid measures. These measures aim to help with the financial pressures businesses face as a result of COVID-19.
The Scottish Government will work with the UK Government to make sure these measures can be adopted to help Scottish businesses where possible.
Find out what financial support you can get for your business from the UK Government:
- UK-wide coronavirus financial business support finder (9 July 2020)
Note some support only available to businesses in Scotland is not included.
Charities funding
Frontline charities across the UK will receive a £750 million package of support to ensure they can continue their vital work during the coronavirus outbreak – this includes hospices and those supporting domestic abuse victims.
£360 million will be directly allocated by government departments to charities providing key services and supporting vulnerable people during the crisis.
Where charitable services are devolved the UK Government has applied the Barnett formula in the normal way.
Devolved administrations are expected to receive £60 million through the charities pot, and further significant Barnett allocations, dependent on the final proposals funded, through the direct grant pot.
Know your finance options
Scottish Enterprise has useful guides on finance options and debt funding for business:
Use your business plan to secure funding
Finance options for your business
Debt funding for your business
Business Gateway has information on financial management and can advise you on how on to manage cash flow, taxes and more.
COVID-19 corporate financing facility (large firms only)
This new facility will help large firms to raise working capital via the Bank of England directly purchasing short-term debt.
It supports companies that are fundamentally strong but have been affected by a short-term funding squeeze and will allow short-term liabilities to be financed.
It also supports the corporate finance market overall, which eases the supply of credit to all firms.
Am I eligible?
- Companies – and their financial subsidiaries – that make a material contribution to the UK economy are able to participate in the facility
- In practice, firms that meet this requirement would normally be:
- UK incorporated companies, including those with foreign-incorporated parents and with a genuine business in the UK
- companies with significant employment in the UK
- firms with their headquarters in the UK
- We will also consider whether the company generates significant revenues in the UK, serves a large number of customers in the UK or has a number of operating sites in the UK
More on eligibility from the Bank of England
How to apply
The scheme is now open for applications.
In order to access this facility, you will need to contact your bank.
It's important to note that not all banks issue commercial paper (an unsecured, short term debt instrument).
If your bank does not issue commercial paper, UK Finance will provide a list of banks that are able to assist.
Find and apply for current innovation funding calls on the Scottish Enterprise website
These calls are focused on tackling coronavirus (COVID-19), including grants, prizes, accelerators, hackathons and collaboration platforms.
Information for stakeholders of the European and Structural Investment Funds programmes from 2014 to 2020. (26 June 2020)
Business continuity checklist (MS Word Doc, 196kB)
Last updated: Friday 7 August 2020