How to access government funding for your small business

Accessing government funding for your small business may seem like a daunting task, but with a little knowledge of the process, it can be a breeze. There are many programs and initiatives available to small businesses owners in Canada, and with a little research, you can find the one that best suits your needs.

In this article, we’ll provide an overview of the government funding landscape and offer some tips on how to access the funds you need to grow your business.

Government Funding for Small Businesses

There are many different types of government funding available for small businesses. The type of funding you are eligible for will depend on the size and structure of your business, as well as your industry sector. 

However, there are usually three main categories of government funding available which include government grants, government loans and tax breaks/credits.

Government Grants: 

Government grants are often the best forms of funding that a business owner starting up can obtain. These grants are typically awarded based on merit, and in most cases they do not need to be repaid. The government grants can be used for a variety of purposes, including research and development, marketing, or expanding your premises, hiring and training your staff and more.

The availability of government grants varies as they are fairly competitive, so staying on top of the programs is crucial. A good idea is to be a part of the Funding Database and regularly check in on the grant funding options, to ensure you are not missing out on any.

Government Loans:

Unlike government grants, the government loans usually need to be repaid with interest, and they can be used for a variety of purposes including start-up costs, equipment purchases, or hiring additional staff.

The benefit of having government loans in comparison to a traditional bank loan is that the interest rates and the conditions which the government loans are approved on are much easier and more lenient. This means that as a startup, just getting stated, your chances of securing the funds is more likely via government options than a bank loan. 

There are government loans that have little to no interest, as well as options which are guaranteed by the government, giving you more freedom with the funding.

Government loans constantly change; keeping an eye out for the best option is crucial. 

Tax Breaks/Credits:

Often avoided, or left behind, the tax breaks and tax credits are some of the best funding options available that you as a small business can benefit from. 

They are often not considered “as good” because you first have to spend the money in order to be able to apply for a tax break or credit at the end of the year. And as a startup, it is more important to have money now, thus the desire for grants or loans, versus money later, in the form of a tax refund of credit.

However, those businesses that do spend money on technology, equipment, renovations..etc; can qualify for a number of tax breaks and credits and receive a refund at the end of the year!

In order to access government funding, you will need to meet certain eligibility criteria. The criteria vary depending on the type of funding you are applying for, but they usually include factors such as being a registered business in Canada, having fewer than 20 employees, and operating in a certain industry sector. 

Each funding agency has different eligibility requirements so working with an expert to find the best options for you which you can apply for is important.

How to Apply for Government Funding

The application process for government funding varies depending on the type and amount of money you are seeking. For smaller funding amounts, you may only need to fill out an online application form. For larger grants or loans, you may need to submit a detailed business plan or undergo an audition process. The best way to find out about the specific application process is to contact the relevant department or agency directly.

Government funding can be a great way to support your small business and help it grow. By doing your research and knowing what type of funding you are eligible for, you can access the funds you need to take your business to the next level.