Levelling up the North through smart grants
Funding and Asset Finance
With only 34 percent of UK funding awarded to Northern regions, how can government funded smart grants help Northern businesses level up?
The North is a hotbed for cutting edge technology whether that be life sciences, digital, energy, software, manufacturing and beyond. Still, funding received by businesses across the region falls far below the national average. Recent statistics show that for every pound awarded by Innovate UK, 66p of which is given to one of four southern regions such as London and the South West.
The shortfall in funding from schemes doesn’t reflect the innovation in Northern regions. Besides a seemingly London centric funding bias, industry experts point out a lack of awareness of cashflow boosting opportunities, especially in the North East. We have seen this in our region time and again with other funding opportunities such as R&D tax relief.
In the current economic climate, it’s more important than ever for businesses to be aware of the funding opportunities available to them, and this will be crucial in helping the region to level up.
What is the Innovate UK smart grant?
Innovate UK is a national funding agency which invests in science and research throughout the UK government funded grant. Their smart grants are designed to level up businesses operating within any sector, as long as they are developing industry disrupting products and processes.
SMEs are invited to submit their innovative ideas in a bid to receive up to £25 million in funding for projects which fall within any area of technology. Such products or services need to be new or innovative to the industry and cannot have been produced before.
There are a number of factors that businesses should be aware of before beginning the application process which will affect how much funding is awarded, such as where they are within their project timeline. It is worth noting that any collaborations with business partners, charities or educational institutions must be registered within the UK. More information on the Innovate UK smart grant can be found here.
How can innovate UK help Northern SMEs?
Funding from Innovate UK will have a mutually beneficial boost to both business and economic growth throughout the North, so it’s disappointing to see that just over a third of the funds have been awarded to Northern businesses.
According to recent statistics the impact of Innovate UK funding on Northern businesses are far reaching. The North East had the highest employee impact; Yorkshire and Humber had the highest positive net worth impact and Scotland topped the tables with the highest funding cost coverage at over 75%, with the North West coming in at a close second.
Innovate UK grants and your business
Innovate UK grants are investment driven, so if you’re working towards creating a new product, process or service that has the potential to be commercialised, then you could be eligible for grant between £25,000 and £1 million to boost your growth potential. Considering the level of innovation throughout the North, business potential far outweighs the number of applications submitted year-on-year.
Even if you’re in the early planning stage of a potential commercial project new to your sector and need to test the feasibility of carrying it out, it is likely that you qualify for a sum that could offer a significant cashflow injection.
Competition for funding through the smart grants is rife. But if your business isn’t successful in the application process, or doesn’t qualify, there are other funding opportunities available for forward-thinking businesses in the North.
Other funding opportunities for innovative businesses
- Research and development tax credits - In recent years, increasing numbers of Northern SMEs have benefitted from research and development (R&D) tax relief. As one of the most valuable forms of relief available in the UK tax system, the relief offers a cashflow injection for businesses who are pushing the boundaries of science and technology, no matter the industry in which you operate.
Unlike other forms of grant funding, R&D tax relief doesn’t have to be repaid, so you can rest assured knowing that it won’t affect your cashflow in the long-term.
- Patent box -If your business has a registered patent, is awaiting a patent or sell products that include patented items, patent box could be an invaluable form of funding for your organisation.
Sitting hand in hand with R&D relief, patent box offers a lower corporation tax rate of 10%, and since June 2020 the scheme has awarded more than £992 million awarded to eligible businesses.
- Grant funding opportunities – Other funding opportunities, whether it be grants or loans are constantly opening and closing. It’s worth keeping up to date with the Government’s website, your local authority and having discussions with your advisors to ensure you’re aware of all of the opportunities available to your business.
Helping your business to access funding
With more economic uncertainty lying ahead, being able to tap into the funding opportunities on offer to your business will be vital in order to ensure your business can continue to grow and thrive.
Whether it’s assessing which funding opportunities are available to you or supporting you with the application process, our team of corporate finance experts are on hand to support you in the months and years ahead.