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Business rates relief and grants: Get the details right

In response to the coronavirus crisis, the Chancellor announced a year-long business rates holiday for 2020-21 on Budget day (11 March). Since then accountants have been trying to find out how how claimants can get their hands on the small business grants the Chancellor added to his coronavirus package.

6th May 2020
Editor in Chief (interim) AccountingWEB
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Business rates

UPDATE, 6 May – In further concessions this week, the BEIS rolled out an extra £617m in discretionary funds to help businesses operating out of shared workplaces, market stalls and charity shops, along with B&Bs not paying business rates and any other deserving firm decided by the council. Revaluations have also been postponed for the whole of 2021.

* * *

The original Budget concession was extended to retail, leisure and hospitality businesses with rateable values below £51000. But like many other government responses to the coronavirus, business rates support mechanisms have been extended since the Chancellor’s original Budget announcement. Rates relief for 2020-21 is now available to the following sectors:

  • Retail  shops including: opticians, petrol stations, garden centres, beauty salons,  travel agents, funeral directors and so on
  • Hospitality premises including restaurants, cafes, takeaways, pubs and live music venues
  • Leisure facilities such as cinemas, hotels and B&Bs, self-catering accommodation, theatres, museums, art galleries, historic houses, gyms, casinos and sports clubs
  • Children’s nurseries
  • Estate agents, lettings agencies and bingo halls that closed as a result of Covid-19.

Targeted grant support schemes

The 12-month business rates holiday didn’t apply to businesses that did not pay rates, so this was supplemented by several additional grant schemes for specific sectors:

  • Small Business Grant Fund (SBGF) – £10,000 available to those eligible for the small business rate relief scheme or rural rate relief scheme– essentially firms occupying properties with a rateable value of less than £15,000.
  • Retail, Hospitality and Leisure Grant (RHLG) – Retail, hospitality and leisure businesses with a rateable value of up to £15,000 will get a grant of £10,000, while those with property valuations between £15,000 and £51,000 will be eligible for £25,000. This grant is available for businesses of the following types
    - shops
    - restaurants, cafés, bars or pubs
    - cinemas and live venues
    - leisure properties such as sports clubs, gyms and spas
    - hospitality premises such as hotels, guest houses or self-catering accommodation.
  • Discretionary top-up grants. These can be given to any deserving business, but were specifically tailored to reach the following types of previously overlooked firm:
     - businesses operating form shared workspace offices
    - regular market stall traders
    - small charities
    - B&Bs that pay council tax rather than business rates.

Grant conditions and restrictions

Some of the key conditions that apply to all these schemes include:

  • Effective from 11 March 2020. Businesses that were dissolved before that date will not be eligible
  • Only available for companies in England; Scotland and Wales have their own versions
  • Eligible recipients will receive one grant per property
  • Businesses such as pubs and leisure facilities that were eligible for the Expanded Retail Discount Scheme announced in January are also eligible for small business grants.
  • Charities that would otherwise meet the criteria but whose bills were reduced by local decisions can still be considered for the RHL grant.
  • Premises occupied for personal uses will be excluded, along with car parks and parking spaces
  • Changes made to the business’s rateable value or rating assessment after 11 March 2020 will be not be used to determine eligibility
  • Local authorities can choose to withhold or award grants where they feel their valuations for a property were inaccurate on 11 March 2020.  “This is entirely at the discretion of the local authority and only intended to prevent manifest errors,” BEIS advised
  • Councils will notify all eligible businesses about the grants. If you wish to refuse the funding, you will need to complete a form to confirm this.

Under the new legislation, local authorities in England have been empowered by the government to dispense a range of business grants to under the following schemes:

Devolved regimes for Scotland and Wales

These concessions announced by the Treasury apply to England only. The Scottish, Welsh governments have their own guidance on how the grant award schemes will operate within their jurisdictions.

The Scottish guidance differs from England in the following ways:

  • The threshold for £25,000 grants for small business is £18,000 rather than £15,000.
  • All non-domestic properties in Scotland will get 1.6% rates relief, applied automatically.
  • Retail, hospitality and leisure businesses will get 100% rates relief, as in England, also applied automatically.

Guidance from the Welsh government sets the threshold for the £25,000 grant payment for retail, leisure and hospitality businesses is £12,001 – lower than in England or Scotland. Businesses in Wales can also access loan and equity funding via the Development Bank of Wales

The grant conditions and criteria in Scotland, Wales and Northern Ireland are detailed by Reshma Johar in a separate article.

State aid complications

In early April, the government updated its guidance to applicants with an explanation of what they will need to do to ensure they remain compliant with Europe’s State Aid rules.

Replies (64)

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By memyself-eye
24th Mar 2020 20:00

Looks like this will be mired in beaurocracy like every thing else touched by the hand of civil servants.
Watch businesses go bust while the local authority decides who are worthy and who are not!

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Replying to memyself-eye:
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By Sanjeev Nanda
15th Apr 2020 11:44

That is the fear, I would say. There has always been a sense of favoritism and biases of the businesses and the governments. One can only hope that the power of the people will override the people in power somehow.
~Sanjeev Nanda

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By Steve Devlin
25th Mar 2020 09:04

I run my accountancy business from a large rented room (50 feet long by 14) within a clients rateable building, identified on the local council rating list as warehouse with offices and mezzanine. The client receives and pays rates for the total property - and my business does not receive a rates bill - I have been here for 8 years.
Am I eligible/should I contact the local rates authority as I have business property (no fixed lease but invoiced for rent) for the £10,000 grant ? (rent £100 per week all inclusive).
Would it fall foul of premises use rules to identify myself operating from within a manufacturing business ? I am their accountant but run other work as well.

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Replying to Steve Devlin:
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By bendybod
25th Mar 2020 09:31

You don't pay rates, therefore don't have a rateable value.

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Replying to Steve Devlin:
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By sallyrichardson
25th Mar 2020 09:42

Ask him for your cut of the grant, as the person the rates bill is addressed to he will get any grant due.

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Replying to Steve Devlin:
wolfy
By rob winder
25th Mar 2020 13:31

I'm in a similar position I moved out of a self contained shop front with a RV but qualified for SBRR several years ago. I now work out of serviced accommodation which is more expensive but I wont get a penny of the grant. Needless to say I am not impressed.

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Replying to rob winder:
By 0098087
26th Mar 2020 09:33

We work from home. Trying to deal with Payroll from 100 clients..we get nothing..
Glad I've never voted Tory and never will..

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Replying to 0098087:
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By Rgab1947
26th Mar 2020 10:40

Now that is a very un-useful comment.

Do you really think even with your political shaded glasses on think that with this virus a Labour Gov or for that matter any Gov could or would have acted differently?

If you cant take your rose tinted spectacles off look at what Netherlands, Germany and a few other Govs are doing and you will find that the UK is generous.

Gov bashing is just what we need now.

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Replying to Rgab1947:
By 0098087
26th Mar 2020 14:59

They knew in January. They could have ordered more PPE or tests but they are so wedded to their right wing ideology which has screwed this country up with this and their brexit nonsense. We could have got this beaten if we'd acted sooner.

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Replying to 0098087:
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By Vallery Lee
27th Mar 2020 10:19

Have you been following what is happening in Spain, Italy and the rest of the world?? or just in critical mode?

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Replying to 0098087:
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By Farkhem Hall
16th Apr 2020 10:46

Brexit nonsense?

Do you really want to now be on the hook for the upcoming trillion euro bailout of the EU economies for years evermore? There is never a better time to break free from the shackles of that incredibly corrupt political organisation and money-devouring monster.

How people like you can be so blind to reality is mind-boggling...SMH

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Replying to 0098087:
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By meadowsaw227
27th Mar 2020 09:41

You get nothing because you have no overheads the same as me !.
What has your inability to vote conservative got to do with anything .

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Replying to meadowsaw227:
By 0098087
27th Mar 2020 10:08

So the ones that don't pay rates get a grant. Why? They don't pay rates

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Replying to 0098087:
By 0098087
27th Mar 2020 10:28

we have chauffeur clients. Work out of home. Business gone. No grant..

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Replying to Steve Devlin:
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By JohnP909
27th Mar 2020 10:30

The answer is for you to ask Valuation Office Agency to rate your premises separately. This will mean that you will then have a rateable value, eligible for small business rate relief. Your landlord's rateable value will also be adjusted (downwards hopefully).

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By BJNATHAN
25th Mar 2020 12:06

Do we know if the grant is taxable income?

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Replying to BJNATHAN:
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By [email protected]
26th Mar 2020 09:37

Yes it forms part of taxable income. I'm located in Scotland and the LAs have the relevant forms on their websites now and are aiming to pay the grants within 10 working days. The forms are clear and simple and one of the declarations required is that you accept that the grant is taxable and must be reported to HMRC as part of the business's taxable income. Of course - that is at it stands at the moment......might all change!

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By mkowl
26th Mar 2020 09:41

I think I may know the answer is no - but would a business with a rateable value of say £5000 in the retail / hospitality sector - in my client case a camp site - would they get the £10k small business grant AND the £10k hospitality one

I suspect the answer is just 10k but did wonder

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Replying to mkowl:
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By wizwozzoo
26th Mar 2020 11:30

I was pondering this exact point in another thread yesterday. There are two schemes and I was starting to think that a small shop might qualify for both.

Thought process was:
So is a shop (hairdresser say) with rateable value up to £15k eligible for £20k?
Scheme 1 (business support grants fund), eligibility criteria, eligible for SBRR.
Scheme 2 (Retail, hospitality and leisure business grants fund), eligibility criteria, eligible for expanded retail discount scheme.

See example 4. Clearly shows a claim for SBRR & expanded retail discount:
https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

The example demonstrated a claim for both being permitted, so on the face of it eligible for both grants.

However, see page 6: https://www.gov.uk/government/publications/coronavirus-covid-19-guidance...

There is an exclusion that appears to bracket both grants "only one grant may be awarded per hereditament"

So looks like there is an exclusion that denies a claim for both on one property (sorry, hereditament)

That said, there is possibly conflicting information further down on page 6, where it records alongside "Grants per business" two distinct separate columns under each grant heading "1 per hereditament" suggesting that a business can claim one of each on each hereditament.

I assume the exclusion has the override here, but confusing all the same.

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Replying to wizwozzoo:
Helen Froggett Thomson
By Helen Froggett-Thomson
01st May 2020 14:44

A business cannot qualify for both I am afraid

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By Springfield
26th Mar 2020 09:43

Who on earth thought that the word "Hereditaments" has any place in a modern day document purporting to provide advice and guidance?

Thanks (3)
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By hmwhiteca
26th Mar 2020 09:53

The situation is slightly different in Scotland.
The grants have to be applied for, and the claim forms went live 2 days ago.
The promise is that the grants will be paid in 10 days.
Most of my clients have been quick off the mark and have already applied!

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Replying to hmwhiteca:
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By PAMDILL
26th Mar 2020 13:19

hmwhiteca wrote:

The situation is slightly different in Scotland.
The grants have to be applied for, and the claim forms went live 2 days ago.
The promise is that the grants will be paid in 10 days.
Most of my clients have been quick off the mark and have already applied!


Same here
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By Christopher Perry
26th Mar 2020 10:41

The article refers to a key condition as being "only available for companies in England".
Should this instead read as "only available to Businesses in England"?

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Replying to Christopher Perry:
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By philaccountant
26th Mar 2020 14:51

I wondered the same thing.

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Replying to Christopher Perry:
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By Southwestbeancounter
26th Mar 2020 18:34

Yes me too! I have read some reports saying companies and others businesses but I think the HMRC guidance (now?) says businesses doesn't it?

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Replying to Christopher Perry:
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By michaelblake
27th Mar 2020 11:33

There is nothing in the guidance that I can see that suggests that the grant is limited to companies in England. As others note the guidance refers to businesses only. Could the author of the article respond to that and correct the wording of the article if needed please to avoid unnecessary uncertainty, and worry for some

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By wizwozzoo
26th Mar 2020 11:32

I am reading this as one grant per business per hereditament. So if someone has 3 retail shops with each a rateable value of £2ok and all eligible for the Expanded Retail Discount Scheme, the business would get £75k, being three claims under scheme 2. Agree, disagree?

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Replying to wizwozzoo:
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By PAMDILL
26th Mar 2020 13:23

NOt according to the small print, if the same business has more than one premises they are still only getting one grant.

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Replying to PAMDILL:
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By wizwozzoo
26th Mar 2020 15:05

Can you direct me to the small print, please? Trying to find conclusive information on this.

line 19 & 25 state (Scheme 1 0r 2) "eligible recipients will receive one grant per hereditament"

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Replying to wizwozzoo:
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By Charlotte J White
16th Apr 2020 21:05

The rules say a grant per premises so each one would get a separate grant - if a retail chain has 10 different stores they would get a grant for each one - that is how I read it - and the council say the grant gets awarded by the account reference registered not on the business

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Replying to Charlotte J White:
Helen Froggett Thomson
By Helen Froggett-Thomson
01st May 2020 14:50

The way I read this is that the grants have different criteria when it comes to this. The Retail Hospitality and Leisure grant £25,000 is PER OUTLET (if they qualify for the £15,001 to £50,999 RV) and only one £10,000 for the Small business which is UNDER £15,000 and has SBRR.
Now I've looked again, I've found this in here (which says each property gets the grant) : https://assets.publishing.service.gov.uk/government/uploads/system/uploa...

Small Business Grant Fund / Retail, Hospitality and Leisure Grant Fund
4
Who is eligible for these schemes?
Small Business Grant Fund Eligibility
11. Businesses with a property that on the 11 March 2020 were eligible for Small Business
Rate Relief (SBRR) Scheme (including those with a Rateable Value between £12,000
and £15,000 which receive tapered relief).
12. Businesses which on 11 March 2020 were eligible for relief under the Rural Rate Relief
Scheme are also eligible for this scheme.
13. Eligible recipients will receive one grant per property.
Exclusions to Small Business Grant Fund
14. You cannot get SBGF for:
• Properties occupied for personal uses, such as private stables and loose boxes, beach
huts and moorings.
• Car parks and parking spaces.
15. Businesses which as of the 11 March were in liquidation or were dissolved will not be
eligible.
Retail, Hospitality and Leisure Grant Eligibility
16. Properties which on the 11 March 2020 had a rateable value of less than £51,000 and
would have been eligible for a discount under the business rates Expanded Retail
Discount Scheme had that scheme been in force are eligible for the grant. Charities
which would otherwise meet this criteria but whose bill for 11 March had been reduced
to nil by a local discretionary award should still be considered to be eligible for the RHL
grant.
17. Recipients will receive one grant per eligible property.

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By Robert Hurn
26th Mar 2020 12:12

mall Business Grant Fund (SBGF) – £10,000 available to those eligible for the small business rate relief scheme or rural rate relief scheme– essentially firms occupying properties with a rateable value of less than £15,000.

Should this read £51,000?

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Replying to bobhurn:
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By bendybod
26th Mar 2020 12:25

Nope. Small Business Fund = all small businesses regardless of sector but only if their RV is below £15,000. Mighty peeved that mine is a shade over £16,000, so despite most of my clients getting a grant, and possibly the retail / leisure one too, I get diddly squat!

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By BBK
26th Mar 2020 12:26

It is not so straight forward. I have my office at home and tried to pay business rates but it says on the local authority website that one does not need to apply. In my mind this means automatic exemption. Therefore I believe there is an entitlement to receive help. I wrote to my local authority and it will be interesing what their reply will be.

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Replying to BBK:
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By sally1964
26th Mar 2020 16:24

The grant is suppose to help with the overheads such as rent, I doubt you incur many overheads if you work from home. Its not free money - future tax payers will be paying this back in higher taxes for many years to come.

Thanks (2)
Replying to BBK:
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By meadowsaw227
27th Mar 2020 09:44

What establishment costs would need covering if you work from home that would not already be paid by the home owner !

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Replying to meadowsaw227:
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By BBK
27th Mar 2020 12:13

Of course establishments costs are incurred. Heating, electric and water (not incurred during office hours if working away from home), business telephone and internet costs. The grant would also help with other overhead costs, it did not say it would be to help businesses ony with their establishment costs but with their ongoing business costs. I concede a £10K grant would be high but a small one of £3K would help.

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By jonkaye
26th Mar 2020 15:29

I would be very grateful if anyone is please able to clarify the following:

I believe that estate agents are now included in the Expanded Retail Discount Scheme. If so and if the rateable value of the business premises is above £15,000, (but below £51,000), does the business now qualify for a grant of £25,000 or will it be restricted to £10,000?

Many thanks for any assistance and guidance.

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By [email protected]
28th Mar 2020 09:18

If the grant is to be counted as taxable income, does it also mean that it counts towards the VAT threshold of £85,000?

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By Ellishakate
28th Mar 2020 09:50

I own my own salon and qualify for small buisness rates relief which means I am eligible. Only we realised yesterday our rates are still registered to the old salon (same street same name ) just door number change, and the guidelines for the local authorities is to not apply grants to buisness who make a change after the 11th of March :( surely someone can see that that is wrong as we are actually getting it but for the wrong address any suggestions on who I could contact higher up than the council offices?

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By Mark121
29th Mar 2020 17:54

We have online furniture shop, plus warehouse with retailable value of £18500. Customers can come to warehouse to view, order and or collect goods. Will this qualify as retail in regards to receive the government grant of £25000

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By MARK BROXTON NURSERY LTD
31st Mar 2020 11:44

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:44

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:44

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:44

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:45

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:45

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:46

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)
avatar
By MARK BROXTON NURSERY LTD
31st Mar 2020 11:47

Hello looking for some advice and guidance on the Grant Schema the government is currently offering!

This business is a small Garden Center/Wholesale plant supplier
Operating since March 2019 as a sole trader!
The lease was granted in January 2020 and the company is now Ltd, We have looked up on line and where not registered for business rates and we don’t have a ratable value. I contacted the landlord, but he is no help as to why!

Should we be contacting the council to get this registered? Would we still get the grants? Or is it too late, I have no idea what the value would be but expecting it to be less than 15k

Thanks

Thanks (0)

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