18 January 2022
The Omicron Hospitality and Leisure Grant provides local councils with one-off grant funding to support to businesses, in recognition that the rise of the Omicron variant means that businesses are to struggle. Grants of up to £6,000 will be paid to hospitality, leisure and accommodation businesses in England. Check your eligibility and the conditions of the grant in the following note.
Who will receive this funding?
The aim of the Omicron Hospitality and Leisure Grant scheme is to support businesses:
that offer in-person services;
where the main service and activity takes place in a fixed rate-paying premises;
in the hospitality, leisure and accommodation sectors.
For the purposes of this scheme, a hospitality business can be defined as a business whose main function is to provide a venue for the consumption and sale of food and drink. Type of business: Food courts, Public houses/pub restaurants, Restaurants, Wine bars, Cafés etc.
For the purposes of this scheme, an accommodation business can be defined as a business whose main lodging provision is used for holiday, travel or other purposes. Type of business: Country house hotels, Guest houses, Hostels, Hotels, etc.
You cannot get funding if:
your business is in administration, insolvent or has been struck off the Companies House register;
you will exceed the permitted subsidy allowance;
your business is not on the Valuation Office Agency (VOA) ratings list.
You must notify your local council if your situation changes and you no longer meet the eligibility criteria, for example, if you become insolvent.
How much funding will be provided to businesses?
The Omicron Hospitality and Leisure Grant will support hospitality, leisure and accommodation business premises with one-off grants of up to £6,000. The following thresholds apply for these businesses:
Businesses occupying hereditaments appearing on the local rating list with a rateable value of exactly £15,000 or under on 30 December 2021 will receive a payment of £2,667.
Businesses occupying hereditaments appearing on the local rating list with a rateable value over £15,000 and less than £51,000 on 30 December 2021 will receive a payment of £4,000.
Businesses occupying hereditaments appearing on the local rating list with a rateable value of exactly £51,000 or over on 30 December 2021 will receive a payment of £6,000.
Any changes to the rating list (rateable value or to the hereditament) after 30 December 2021 should be ignored for the purposes of eligibility.
How will the grant be provided?
This funding will be a one-off lump sum payment. As part of their application process for the scheme, all businesses will be required to self-certify that they meet all eligibility criteria. Local Authorities must verify the evidence provided as part of pre-payment checks.
The application closure date for this scheme is 28 February 2022. Grants cannot be awarded or offers issued after this date. All final payments must be made and dispersed to recipients by 31 March 2022. All monies must be fully defrayed from the Local Authority bank account by 31 March 2022.
Will grants be subject to tax?
Grant income received by a business is taxable. The Omicron Hospitality and Leisure Grant will need to be included as income in the tax return of the business.
Only businesses that make an overall profit once grant income is included will be subject to tax. Payments made to businesses before 5 April 2022 will fall into the 2021/22 tax year.
Subsidy allowance
The EU State aid rules no longer apply to subsidies granted in the UK following the end of the transition period, which ended on 31 December 2020. The United Kingdom remains bound by its international commitments, including subsidy obligations set out in the Trade and Cooperation Agreement (TCA) with the EU. COVID-19 business grants subsidy allowances provided on the basis of the TCA. The below scheme rules should be applied to applicants at the level of economic actor, which is defined as an entity or a group of entities constituting a single economic entity regardless of its legal status, that is engaged in an economic activity by offering goods or services on a market.
There are 3 subsidy allowances for the COVID-19 Business Grant Schemes set out below:
Small Amounts of Financial Assistance Allowance – you’re allowed up to £335,000 (subject to exchange rates) in Small Amounts of Financial Assistance over any rolling period of 3 financial years;
COVID-19 Business Grant Allowance – under this allowance you’re allowed up to £1,900,000 across all COVID-19 Business Grant schemes;
COVID-19 Business Grant Special Allowance - if you have reached your limits under the Small Amounts of Financial Assistance Allowance and COVID-19 Business Grant Allowance, you may be able to access a further allowance of funding under these scheme rules of up to £10,000,000 across all COVID-19 Business Grant schemes.
Grants under these 3 allowances can be combined for a potential total allowance of up to £12,235,000 (subject to exchange rates).
Summary
New business support measures should be expected at the moment, and the Omicron Hospitality and Leisure Grant of up to £6,000 is the one of them. Besides this, the British businesses can use subsidy allowance for their purposes to overcome a difficult period.
For further information on any of the points above contact
Mikita Makayou at mikita@lexefiscal.com, or
Dr. Frank at clifford.frank@lexefiscal.com.
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