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Additional Restrictions Grant (ARG)

Discretionary Grant Policy Phase Three

If your small, micro or home-based business has experienced a loss of income, it may be eligible for an Additional Restrictions Grant from Merton Council. A points-based system will be used to share a grant fund of approximately £1.9 million between eligible businesses.

Apply by midday on 17 August 2021

Apply now


The criteria will be exactly the same as Phase Two. To be eligible, your business must meet all of the following criteria. The business must:

  • be home-based, or a small or micro business, as defined below
  • have been trading prior to 1 January 2020 in Merton
  • have had a loss of income of 40% or greater, for the period April 2020 to March 2021 compared to the previous year, as detailed below
  • not be a nationally run company operating a number of stores or chains locally or across the UK
  • not be in administration, insolvent, struck off or subject to a striking-off notice
  • not have received funding through Merton Giving
  • not have received an SEISS grant (Self-Employment Income Support Scheme grant) from the Government

When calculating loss of income:

  • loss of profit will not be considered
  • if your business does not have a full year's trading records for 2019/20 we will extrapolate income for the part of year over the whole 12 months.
  • Furlough payments will not be included
  • Any business grants received from the council, any other council or the Government will be treated as income and must be declared along with your income

To be eligible for this scheme as a home-based business, it must:

  • be run from a Merton residential address
  • have a turnover of at least £15,000 a year
  • not have received a government Self-Employment Income Support Scheme grant.

To be eligible for this scheme as a small or micro business, it must:

  • satisfy two or more of the following requirements in a year:
    • turnover of £10.2 million or less,
    • balance sheet total of £5.1 million or less
    • employ fewer than 50 staff
  • have accommodation costs – either Business Rates, rent, mortgage or licence fees (businesses in shared spaces are included)

Small or micro businesses can apply for this grant even if they have received previous grants or Business Rates Relief.

Funding available

Merton Council has £1,936,708 available for this phase of the Additional Restrictions Grants scheme. Up to £600,000 of funding will be allocated to wider business support initiatives including contributions to cover works which were started under Phase 2 but not completed by 18 June 2021. The focus will be on developing infrastructure rather than activities aimed at individual businesses. (The Director of Corporate Services can divert any of this funding into a third stream if it's proving difficult to spend the allocated amount or to ensure future bids for discretionary funding can be made.)

All remaining funding will be allocated for direct business grants reflecting the criteria set out on this page.

Grant allocation

The value per point will be 'capped at' the value in Phase Two i.e. £3,058. Again grants will be capped at the loss of income the business had. If the total value of grants to be paid based on the value per point of £3,058 exceeds the allocated funding then the value per point will be reduced proportionately.

The grant fund will be shared between all successful applicants using a points-based system.

Points will be awarded to each business based on accommodation costs and employees as follows.

Accommodation costs

Monthly accommodation costs Points
£500 or less1
£501 to £1,0002
£1,001 or over3
  • Accommodation costs are calculated as rent and businesses rates combined.
  • If the business has more than one property in Merton then accumulated costs will be taken.
  • Accommodation costs for properties outside of Merton will not be included.
  • If in 2020/21 the business has received Business Rates Relief then the rates charge per month will be zero.


Type of employee Points
Non-Merton residents1 per employee
Merton residents3 per employee
  • Employees need to be salaried and not contractors or self-employed staff.
  • A business run from home would be awarded three points as the application must be a Merton resident. Additional points would be for any staff employed. Property costs for the home will not be taken into account.

How grants are calculated

After all applications have been reviewed and scored, the total number of points for all applications will be calculated and each point will be awarded a monetary value of £3,058.  Grants will be capped at 100% of the total loss of income.  Only one grant per business can be awarded.  Businesses that were awarded a grant under Phase Two of the scheme will not be eligible for a further grant.

Paying grants

All applications will need to have been received and assessed before any grants are paid.

Pre- and post-payment checks will be undertaken.

Decision making

If the information requested is not provided, after working with the applicants, the application will be refused.

Decisions on applications and awards will be made at a panel consisting of:

  • Director of Corporate Services
  • Chief Executive of Merton Chamber of Commerce
  • Chief Executive of Merton Connected 
  • Head of Revenues and Benefits
  • Economy Manager

Final decision will be made by the Director of Corporate Services.

The applicant will be notified of the decision by email.

The progress and results from the scheme will be reported to Cabinet and BEIS and successful applicants published on our website.


We are not required to provide a right of appeal against any decision, as grants awarded under the Additional Restrictions Grant scheme are discretionary. However, we will work with applicants to make sure they provide the necessary evidence to support a successful application.

The Council operates a complaints process for dissatisfied service.


Additional Restrictions Grant Policy Phase 3