Coronavirus (COVID-19): December and January Business Support Top Up – Hospitality

The Scottish Government has announced further details about the Coronavirus (COVID-19): December and January Business Support Top Up Fund for Hospitality businesses.

This support is to be targeted at Scottish businesses in the hospitality sector who have lost bookings during December 2021 and January 2022 and will take the form of a one-off grant.

How much will the grant be?

The grant is a one-off payment at the rate of:

• £4,500 for premises which have a rateable value of up to and including £51,000, or

• £6,800 for premises have a rateable value of £51,001 or above

The rateable value of the property will be as per Local authority records at 1 November 2021.

Individual ratepayers with more than one business, may receive an award for each registered business entity.

Is my business eligible? 

The Fund will provide support to businesses in the hospitality sector which have lost crucial bookings during the December and January key trading period that are registered as one of the following: –

• public house
• restaurant
• cafe
• other licensed premises classed as hospitality
• nightclub
• hotel with bar and restaurant

Any business not classified as one of the above will not be eligible for this funding.

Awards will be granted based on the primary function of the business. The relevant Local authority will determine if a business meets the relevant classification and they will request further information if required to determine the eligibility of the business.

Businesses in the public sector or arm’s length external organisations (ALEOs) are not eligible.

The Local authority will require evidence that the businesses meets the eligibility criteria. Being registered for non-domestic rates (NDR) will be the main way for them to do this and the application process will request the unique identifier number for this.

The grant is available for businesses with premises registered for NDR as of 8 December 2021.

Local authorities may also ask for details on the business owner/s and evidence of premises being used as a business in one of the eligible businesses such as licensing details.

In addition, other details will be required to allow payment to be made such as bank account details and proof of access to this.

Local authorities have discretion to award grants to eligible businesses that lease or rent premises which are not rated, such as those leased from a council in a public park.

The business must be actively trading and be able to demonstrate they were trading on 8 December 2021. Where necessary, Local authorities can request additional evidence to determine this eligibility such as receipts, banking or other evidence.

Provided they meet all the eligibility criteria, businesses which are Limited Companies (including social enterprises), Sole Traders, Trusts, Partnerships, Community Interest Companies or Scottish Charitable Incorporated Organisations, may apply for a grant.

All businesses must declare the following as part of the application process and supply documentation where necessary: –

• The business must have a business bank account (although the guidance published does state that payments will be made into personal bank accounts where a business account does not exist)

• The business must not have breached wider COVID regulations/requirements prior to local restrictions

• The business must not have connections to tax havens, as set out in the Coronavirus (Scotland) (No.2) Act 2020

Applicants will be required to declare all previous support received from UK, Scottish and Local Government support schemes to provide Local authorities with the necessary information to ensure payments are made correctly and compliant with EC State Aid limits. 

How to apply

Businesses who previously received payments from the Strategic Framework Business Fund

Local authorities will contact hospitality businesses they have previously made payments to via the Strategic Framework Business Fund between now and the end of January. The last grants from this Fund were paid in April 2021.

For the vast majority of eligible businesses the Local authorities should already hold sufficient data to establish eligibility. These businesses will only be asked to confirm that: –

• they are still a registered business
• they were trading at 8 December 2021
• they wish to receive funding
• the details the Local authority already holds are up to date

New businesses set up since April 2021 or where there has been a change of use

Businesses which are registered as a public house, restaurant, cafe, hotel with a restaurant and bar, nightclub or other licensed club that have never received COVID-19 grants via the Local authority, may be eligible for funding.

Additional details will be required to be gathered in order to assess this and further details of this process will be provided by the Scottish Government in early January 2022.

How will the business get paid?

• Payments will be processed subject to the Local authority receiving any relevant supporting information required

• Payments will be made into the business bank account of the business where possible and personal accounts where a business bank account is not held by the business

Will there be a review process?

Local authorities will offer a review process where they have declined an application for funding. Information on the review process can be obtained from the Local authority you apply to.

Tax implications

Grant income received by an individual or business is taxable.

The grants from The Coronavirus (COVID-19): December and January Business Support Top Up – Hospitality fund will therefore require to be included as income in the tax return of the individual or business.

When does the Fund close?

The December and January Business Support Top Up – Hospitality Fund will close for applications on 31 January 2022.

Other Information

Where evidence of fraud or misuse of the fund is identified, this will be recorded and may be taken into account in future applications. Where appropriate, the applicant will be made aware this is the case and be given the opportunity to explain.

Local authorities will seek recovery of overpayments, including pressing criminal charges where necessary, where claims are found to be fraudulent.

Non-domestic rate payers are eligible for a one-off grant regardless of any arrears. Local authorities have some discretion to withhold grant awards in very exceptional circumstances where the business has significant outstanding arrears, which have been subject to a court decision.

https://www.gov.scot/publications/coronavirus-covid-19-december-and-january-business-support-top-up-hospitality-information-for-businesses/

Photo by Libby Penner on Unsplash

The information in this blog provides only an overview of Scottish Government guidance and legislation in force at the date of publication and no action should be taken without consulting the detailed Scottish Government guidance and legislation or seeking professional advice.  Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this blog can be accepted by the firm.