Am I eligible for a business grant?

Eligibility is where most wasted effort happens. Working through four checks first will tell you in minutes whether an application is worth starting.

The four gates

• Organisation type. Limited companies are required for most Innovate UK and British Business Bank programmes. Sole traders and partnerships qualify for some local authority grants and Start Up Loans but are excluded from many innovation schemes. Charities need Charity Commission, OSCR or CCNI registration for community funding; community interest companies can often access both business and social streams.
• Size. The standard SME definition is fewer than 250 employees with turnover under €50 million or a balance sheet under €43 million; small is under 50 employees and €10 million, micro under 10 employees and €2 million. Crucially, it applies to the whole group — a parent company's figures are aggregated, which catches subsidiaries out.
• Subsidy control. Since the Subsidy Control Act 2022 replaced State aid, most small grants are given as Minimal Financial Assistance, capped at £315,000 across all public sources over any rolling three-year period. You must declare previous public grants, and false declarations lead to clawback.
• Trading history and financial standing. Programmes typically want six months to three years of trading, recent accounts, and sometimes a credit check. Start-up-specific schemes are the exception.

Two details that catch people out

Location and sector restrictions are absolute: a grant tied to a combined authority area or to manufacturing will not stretch, however good the project. And the split between eligible and ineligible costs shapes your budget. Direct project costs — staff time, equipment, materials, travel — usually qualify. VAT is normally ineligible if you are VAT-registered, because you recover it anyway; costs incurred before the project start date, land purchase, financing costs and entertainment are almost always excluded.

If your organisation has had financial difficulties, be transparent and show what has changed. Funders assess financial standing from your accounts and may refuse an otherwise excellent project from an organisation in difficulty — but concealment discovered later means clawback and a closed door with that funder for good. UK subsidiaries of overseas parents can apply to some schemes, notably Innovate UK, provided they are registered at Companies House and the work happens in the UK.