HMRC Funding

HMRC funding refers to finance solutions that help businesses manage their tax obligations to HM Revenue and Customs. Whether it's Corporation Tax, VAT, or Self-Assessment liabilities, this funding allows you to spread payments over time, reduce cash flow strain and stay on top of your commitments.

VAT Funding

VAT funding specifically allows businesses to finance their quarterly VAT bills, reducing pressure during peak VAT payment periods. This helps avoid sudden cash flow hits and ensures you can meet your VAT obligations on time without dipping into reserves or delaying other expenses.

Corporation Tax Funding

Corporation Tax funding helps you manage annual Corporation Tax payments by dividing them into manageable monthly instalments. Instead of making a significant payment at once, your business can protect its liquidity and avoid the disruption that often comes with large, one-off outflows. Funding is typically available for up to 12 months, giving you flexibility and peace of mind when planning ahead.

• Improve your cash flow by avoiding large payments
• Regular repayments mean no surprises and easier forecasting
• A timely payment record keeps you compliant with HMRC
• Funding lines dedicated to your tax liabilities
• Easy renewals for ongoing funding

Eliminate the strain of large, lump-sum tax or VAT payments. By spreading your tax liabilities over regular monthly repayments, you gain greater control over your business’s cash flow. These predictable, fixed repayments align with your typical monthly expenses and allow for easier budgeting, better financial forecasting and fewer unexpected cash shortages.

With Tax and VAT Funding, you can reinvest cash into areas that drive growth without being held back by tax deadlines. Maintaining consistent payments also helps uphold your HMRC compliance record, avoiding penalties and strengthening your business’s financial reputation.

Get continued tax funding without hassle. Exclusive funding lines are dedicated specifically for your tax liabilities, and renewing your HMRC funding solutions is simple.

Here's a stress-free solution to spread the cost of your HMRC obligations evenly, aligning them comfortably with your usual monthly expenses.

• Corporation Tax: Due 9 months and 1 day after your financial year-end. We can arrange funding or reimbursement of your tax liability up to 30 days after this date.
• VAT: Typically due quarterly. We arrange funding or reimbursement up to 14 days after your VAT deadline.
• Self-assessment liabilities: Also eligible for flexible funding solutions.

With a straightforward application process and typically no requirement for personal guarantees on funding under £150k, managing your business finances becomes simpler and smoother.

Applying for Tax Funding and VAT Funding is simple. Here’s what you'll need:

• Latest filed accounts
• 3 months of recent bank statements
• Latest management accounts
• Proof of your tax liabilities (VAT returns or Corporation Tax computation)
• Snapshot of your HMRC position (PAYE, Corporation Tax, VAT) or an email confirmation from your accountant

Ready to simplify your VAT and Corporation Tax obligations? Get in touch with our brokers, who will talk you through the details and help you apply.

Timely tax payments are essential for avoiding penalties and maintaining a good standing with HMRC. Late payments can lead to interest charges and reputational harm (something no business wants).

Funding your VAT and tax bills gives you a reliable way to stay compliant. It ensures HMRC is paid on time, every time, while you repay the amount gradually in a way that suits your business cash flow. That stability not only protects your record but also builds trust with lenders and HMRC alike.

1. Improved Cash Flow

One of the primary benefits of invoice financing is improved cash flow. By accessing immediate funds through invoice financing, businesses can meet their day-to-day expenses, pay employees, invest in growth opportunities, and cover any unexpected costs. This eliminates the need to wait for extended payment terms, helping businesses maintain a steady flow of working capital.

2. Fast Access to Funds

Traditional bank loans can be time-consuming and require extensive paperwork, while invoice financing offers a quick and straightforward alternative. Once a business submits its invoices to the factoring company, it can receive a significant portion of the invoice value within a short period, usually within 24 to 48 hours. This rapid access to funds enables businesses to promptly address their immediate financial needs.

3. Reduction in Bad Debt Risk

Late or non-payment of invoices can lead to bad debt and financial instability for small businesses. With invoice factoring, the factoring company assumes the risk of collecting payment from customers. This reduces the business owner's worry about non-payment, allowing them to focus on core operations rather than chasing after unpaid invoices. Businesses can protect their cash flow and mitigate potential losses by transferring credit risk to the factoring company.

4. Flexibility and Scalability

Invoice financing is a flexible solution that grows alongside the business. Unlike traditional loans, which often have fixed borrowing limits, invoice financing allows businesses to access funds based on their sales volume. As the business expands and generates more invoices, the available funding increases accordingly. This scalability makes invoice financing an attractive option for small businesses looking to manage their cash flow efficiently.

5. No Collateral Required

Unlike other financing types, invoice financing does not typically require business equipment or physical assets as collateral. The invoices themselves act as the collateral, making it accessible for businesses that may not have significant assets to pledge. This opens up opportunities for businesses that may not qualify for traditional loans due to a lack of collateral or limited credit history.

6. Improved Credit Control

Invoice financing often comes with additional benefits, such as credit control services provided by the factoring company. Factoring companies specialise in managing credit collections and monitoring customer payments and take that responsibility on as part of their invoice finance service. This proactive approach to credit control ensures a healthier cash flow and minimises the impact of bad debt on the business. It also relieves businesses from the burden of credit control tasks, allowing them to focus on core business activities.

7. Cost-Effective Financing

Invoice financing can be a cost-effective solution compared to other forms of financing. While costs are associated with invoice financing, such as factoring fees or discount rates, the benefits gained, such as improved cash flow and credit control, often outweigh the expenses. Because this is essentially a "secured" form of debt, it can be significantly cheaper than alternatives like loans and overdrafts. Businesses must evaluate the overall impact on their financial health and growth potential when considering invoice financing.