A hotel refurbishment can be a big investment, whether you’re refreshing a handful of bedrooms or making changes across the whole property. So it’s worth checking what financial support is available before you start.
You won’t find one government grant that covers hotel refurbishments across the UK. Instead, you can explore different sources of support. What you can access will depend on the hotel, where it’s based and, in some cases, what you plan to change.
Are there grants for hotel refurbishment in the UK?
Hotel refurbishment grants tend to be linked to a particular area or type of project, rather than being available to hotels across the country. Local schemes can sometimes support improvements to commercial premises, hospitality businesses or projects that benefit tourism and the local economy.
It’s worth looking closely at what each scheme will actually pay towards. One council might fund certain building improvements, while another scheme could focus on a completely different area. You may also need to put some of your own money towards the work.
Where your hotel is based matters, as available funding can vary from one part of the UK to another.
Funding for an energy-efficient hotel refurbishment
If you’re refurbishing to make your hotel more energy efficient, you may have additional support to consider. This can include local funding for energy-saving measures, as well as incentives for investing in renewable technology.
Solar panels and heat pumps are good examples. In England and Wales, installing eligible renewable energy equipment won’t increase the property’s business rates valuation because of that equipment. This exemption is in place until 1 April 2035.
Local energy-efficiency schemes can also come and go, so check what’s available before starting the work. Some funding may need approval before you commit to the project or make a purchase.
Tax and business rates relief for hotel refurbishments
Grants aren’t the only way to reduce refurbishment costs. You may be able to claim capital allowances on qualifying equipment and machinery, allowing you to deduct some or all of their value from your profits before paying tax.
There may also be help with business rates. In England and Wales, Improvement Relief can apply when eligible work increases a property’s rateable value by increasing its size or adding new features or equipment. If you meet the eligibility requirements, the relief lasts for one year after completion.
The rules aren’t the same throughout the UK, so check which tax and business rates arrangements apply to your hotel before relying on them in your plans.
What could hotel refurbishment funding cover?
It depends on the individual scheme, but support can sometimes cover property improvements, new equipment, energy-saving measures or work connected with tourism and local economic development. You may also need to fund part of the project yourself.
Planning a hotel refurbishment?
IH Group works with independent hotels and larger hotel groups on refurbishments of all sizes. Whether you’re updating bedrooms and bathrooms or transforming restaurants and communal areas, we can help you plan the work and make the most of your available budget.
Contact us today to discuss your hotel refurbishment and how we can help.
