The government has now announced that businesses ordered to close as a result of local lockdowns may be eligible for a cash grant for every 3 weeks that they stay closed. This is referred to as the Local Lockdown Business Support Scheme.
Payments are triggered by a national decision to close businesses in a high incidence area. Each payment will be made for a 3-week lockdown period. Each new 3-week lockdown period triggers an additional payment.
If a business occupies a premises with a rateable value of less than £51,000, or occupies a property (or part of a property) subject to an annual rent or mortgage payment of less than £51,000, it will receive a grant of £1,000.
If a business occupies a premises with a rateable value of £51,000 or more, or occupies a property (or part of a property) subject to an annual rent or mortgage payment of £51,000 or more, it will receive a grant of £1,500.
If a business does not pay business rates, they may still be eligible for the grant. Local Authorities will receive an additional 5% top-up of funding to enable them to help businesses who may not be paying business rates but are nonetheless affected by closures. Payments made to businesses from this discretionary fund can be of any amount up to £1,500 and may be less than £1,000 in some cases.
Local Authorities will be responsible for distributing the grants to businesses in circumstances where they are closed due to local lockdown restrictions.
Any businesses still closed at a national level (e.g. nightclubs), will not be eligible for the grant. This is only for businesses that have been allowed to reopen and have since been forced to close due to local restrictions.
As with other Covid business grants, this will be treated as a taxable income to the business.
Applications for the grant will be handled on a local level. Local Authorities may impose further eligibility criteria not offered by government in order to determine how much of the grant they may receive. Businesses who think they might be eligible for a local lockdown business grant should contact their local council who will be able to tell them what they should do to apply.
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