Grants for UK Startups and New Businesses in 2026

Finding funding as a startup is harder than it sounds. Many grant schemes require 12 months of trading history, filed accounts, or demonstrated revenue — none of which a brand-new business has. But there are genuine funding options for early-stage businesses in the UK, if you know where to look.

This guide covers grants, loans, and support programmes that are specifically open to startups and new businesses in 2026.

The Reality of Startup Grants

Let's be honest: pure grants for brand-new businesses — under 12 months old with no revenue — are rare and usually small. Most government grant schemes are designed for established SMEs that can demonstrate trading history, financial stability, and a track record of delivery.

However, there are meaningful options available, especially if you are willing to combine grants with other funding sources. The most common startup funding path in the UK combines a Start Up Loan with a local Growth Hub grant and free business advice — together, these can provide £5,000 to £30,000 in funding plus professional support. This section sets realistic expectations before covering the actual options.

Government-Backed Startup Funding

Start Up Loans

The UK government's Start Up Loans programme, delivered by the British Business Bank, offers loans of £500 to £25,000 at a fixed 6% interest rate. Technically a loan rather than a grant, but it is government-backed, has no early repayment fees, and comes with 12 months of free mentoring from a business professional.

The programme is available to businesses under 3 years old or not yet trading. You need a viable business plan and a personal credit check. The average loan is around £6,000 to £8,000. This is the single most accessible government funding for pre-revenue startups. You can apply at startuploans.co.uk.

Innovate UK Smart Grants

If your startup is developing genuinely innovative technology or processes, Innovate UK's Smart Grants programme offers grants of £25,000 to £2 million for feasibility studies and R&D projects. Open to single SMEs or collaborations. Projects must demonstrate strong commercial potential and a clear innovation beyond what already exists in the market.

These are competitive — success rates are around 10% to 15% — and require a detailed technical application. But if your startup is technology-driven, this is one of the largest non-dilutive funding sources available. For a full rundown of current Innovate UK competitions, see our article on Innovate UK grants open now.

Innovate UK Innovation Loans

For startups with later-stage R&D projects closer to market, Innovation Loans offer £100,000 to £5 million at favourable terms. Your project must demonstrate a clear path to commercialisation. Rounds open regularly — Round 26 closes 29 April 2026. Unlike equity investment, these loans preserve your full ownership of the business.

Growth Hub Startup Grants

Many regional Growth Hubs run specific programmes for startups and businesses trading under 3 years. These are typically smaller grants (£500 to £10,000) but considerably easier to access than national schemes. Examples include startup competitions, matched-funding grants for equipment or marketing, and subsidised mentoring programmes.

The eligibility criteria and available amounts change frequently as UK Shared Prosperity Fund allocations are distributed by local councils. The best approach is to contact your regional Growth Hub directly — they can tell you exactly what is available in your area right now. See our Growth Hub guide for details on every region, or browse grants by region to find local opportunities.

Local Authority and Council Grants

Many local councils offer small grants specifically for new businesses, especially in areas targeted for economic regeneration. The UK Shared Prosperity Fund continues to fund local business support programmes, with grants typically ranging from £2,500 to £10,000.

Recent examples include the Newark and Sherwood UKSPF grants (£2,500 to £10,000 for small businesses) and the Enterprising Worcestershire programme (matched-funded grants of £1,000 to £10,000 for businesses trading under 3 years). These are highly localised — what is available depends entirely on your council area. Search for “[your council] business grants” or check your Growth Hub.

Alternative Funding Sources

The Prince's Trust (Ages 18–30)

The Prince's Trust offers Enterprise Programme grants and loans for people aged 18 to 30 starting a business. Awards of up to £5,000 in grant form, plus mentoring and business support. This is one of the most accessible routes for younger entrepreneurs — the application process is straightforward and decisions are relatively fast.

Charitable and Foundation Grants

Several UK charities and foundations offer grants for startups in specific sectors. The Wellcome Trust funds health-related innovation (primarily through university partnerships). The Bezos Earth Fund supports climate-related ventures. UnLtd supports social enterprises with awards of £500 to £15,000.

These tend to be sector-specific — they will not suit every business. But if your startup aligns with a foundation's mission, they can provide significant funding alongside credibility and networking opportunities.

EIC Accelerator (EU Funding)

Despite Brexit, UK businesses remain eligible for some EU funding programmes. The EIC Accelerator, part of Horizon Europe, offers grants of up to €2.5 million and equity investments of up to €10 million for innovative startups with high growth potential. It is highly competitive but potentially transformative for the right company — particularly those in deep tech, biotech, or climate technology.

University and Incubator Programmes

Many UK universities offer funding, workspace, and mentoring for startups through their incubators and accelerators. These programmes often include small grants (£1,000 to £10,000), subsidised office space, and access to university research facilities. If your startup has a technology or academic angle, university programmes can be an excellent starting point — they combine funding with expert support and a built-in network.

Tax Relief — The Hidden Funding

Two tax relief schemes effectively function as startup funding by incentivising investors to back early-stage businesses:

Seed Enterprise Investment Scheme (SEIS)

SEIS offers investors 50% income tax relief on investments of up to £200,000 per year in qualifying startups. Your startup can raise up to £250,000 through SEIS. For investors, the tax relief substantially reduces their risk, making them significantly more likely to invest in an unproven business. SEIS is specifically designed for very early-stage companies.

Enterprise Investment Scheme (EIS)

EIS offers 30% income tax relief on investments in qualifying SMEs. Your company can raise up to £5 million per year through EIS, or up to £12 million over the company's lifetime. Combined with Capital Gains Tax deferral, these schemes make angel investment significantly more attractive.

Both schemes require your company to meet specific criteria — UK-based, qualifying trade, not listed on a main stock exchange. HMRC advance assurance is strongly recommended before raising investment. These are not grants, but they are the most powerful funding mechanism available to UK startups and they cost the company nothing directly.

Building a Startup Funding Strategy

Do not rely on a single source. The most effective startup funding strategy combines multiple sources — a Start Up Loan for initial capital, a Growth Hub grant for a specific project, free advice from your Growth Hub advisor, and SEIS/EIS to attract angel investors.

Apply for everything you are eligible for simultaneously, since grant decisions take weeks to months. There is no penalty for applying to multiple schemes, and a rejection from one does not affect your chances with another.

Get your business plan and financial projections in order first — every funding source will ask for them. A clear, realistic business plan is the single most useful document a startup founder can produce. It forces you to think through your market, your costs, and your growth path, and every funder, lender, and investor will want to see one.

Be realistic about timelines: from application to receiving money typically takes 2 to 6 months. Plan your cash flow accordingly, and do not assume any single application will succeed.

For help finding grants matched to your specific business, Subsidy Scanner tracks over 2,300 grants across 35+ official UK sources — including Growth Hub grants, Innovate UK competitions, and local authority schemes. Create a free profile to get matched. For step-by-step application advice, see our guide on how to apply for grants.