UK Business Grants 2024/25

Grants are free money you do not have to repay — but they are competitive and usually require match funding. Here is a practical overview of the main grant types available to UK small businesses in 2024/25.

What types of grants are available?

1. Innovate UK Grants

The UK's main innovation agency funds R&D and technology projects. Key programmes include:

• Smart Grants — For game-changing innovation projects. Grants from £25,000 to £500,000. Typically 60–70% of eligible project costs.
• Innovate UK EDGE — Grants paired with expert coaching for high-growth potential businesses.
• Knowledge Transfer Partnerships (KTPs) — Funded collaborations between businesses and universities. Government pays up to 67% of costs for SMEs.

2. UK Shared Prosperity Fund (UKSPF)

Replaced EU Structural Funds post-Brexit. Administered locally by councils and Growth Hubs. Focuses on:

• Skills and training for employees
• Capital investment for SMEs
• Community and place projects

Grants typically £1,000–£25,000. Check your local Growth Hub for current rounds.

3. Growth Hub Grants

Each English region has a Growth Hub (part of the LEP network) offering local business grants. Amounts vary widely — from £500 micro-grants to £100,000+ for capital investment. Find yours at LEP Network Growth Hubs.

4. R&D Tax Credits (not a grant, but similar benefit)

SMEs can claim back up to 33p for every £1 spent on qualifying R&D through HMRC R&D Tax Relief. From April 2024 the merged scheme offers 20% above-the-line credit for most businesses.

5. Apprenticeship Incentive Grants

• £1,000 payment for hiring an apprentice aged 16–18 (or care leavers)
• Government pays 95–100% of apprenticeship training costs for SMEs through the Apprenticeship Levy system
• Use the Apprenticeship Service to find approved training providers

6. Rural Grants (FETF / SFI)

For rural and agricultural businesses in England:

• Farming Equipment and Technology Fund (FETF) — Grants for specific equipment items (list published by DEFRA). Up to £50,000.
• Sustainable Farming Incentive (SFI) — Annual payments for sustainable land management.
• Rural England Prosperity Fund — Capital grants for rural businesses and community projects.

7. Energy Efficiency Grants

• Industrial Energy Transformation Fund (IETF) — Up to £40M available for manufacturing businesses to decarbonise. £100,000–£30M per project.
• Energy Efficiency Loans (BBB) — Not grants but 0% interest loans via British Business Bank for energy efficiency investments.
• Local council energy efficiency grants — Vary by region; check your local council or Growth Hub.

How to find grants

How to apply successfully

Most grant applications require:

• A business plan — Even for small grants. Show viability, market, and growth potential.
• Match funding — Most grants cover 30–70% of costs; you must fund the rest yourself or via a loan.
• Eligible expenditure — Grants cover specific costs (capital equipment, staff time, external expertise). VAT is rarely eligible if you are VAT-registered.
• Financial accounts — Last 2 years or management accounts for startups.
• Evidence of need and impact — How will the grant create jobs, increase turnover, or benefit the local economy?

Key mistakes to avoid

• Spending money before the grant is approved — most grants cannot reimburse prior expenditure
• Missing application windows — grant rounds are often short (4–8 weeks)
• Underestimating the reporting burden — grant recipients must submit progress reports and financial evidence
• Applying for grants not aligned to your sector or region

Useful resources

• GOV.UK: Business Finance and Support Finder
• UKRI Funding Opportunities
• British Business Bank Finance Hub

→ Also read: Startup Loans & Business Funding Guide