Paying VAT bills every quarter is a legal obligation for organisations with a taxable turnover, but it can be a financial obstacle for many, especially in the current financial climate. Cashflow issues are a common side effect of each quarterly payment. However, what many do not realise, is that it doesn’t have to be like that.
Many organisations choose to take the sting out of paying the bill with a VAT loan. This ensures HMRC are paid in full and on time but the cost to the organisation is spread out over repayments over time. This can help businesses to retain valuable cash, avoid late payment penalties, and establish a healthier cashflow.
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If your organisation is struggling with cashflow when their VAT is due to be paid or you would rather invest their cash in growth (e.g., to buy new assets), you might apply for a VAT loan.
The lender pays HMRC the amount owed in full, and you pay the lender back in instalments over time.
Repayments are subject to fixed interest rates (which will vary depending on the organisation’s circumstances) and typically made on a monthly basis over 3, 6, 9 or 12 months.
The amount a business can borrow will depend on the unique circumstances of the business and eligibility. In addition to credit checks and a review of the business’s financial situation, other eligibility criteria will usually apply, often including:
At Bluestone, we understand that applying for a VAT bill loan can be a daunting process, especially if you're unfamiliar with the requirements and criteria. That's why we're here to support you every step of the way.
Our team of finance experts have years of experience helping businesses like yours secure the funding they need to cover their VAT bills. We'll work closely with you to understand your specific requirements and provide you with a range of financing options tailored to your business needs.
You can start your VAT loan application today via the Bluestone Portal, orcontact us today for a no-obligation conversation about your financial requirements.
Alternatively, you can email our Commercial Loans Specialist directly at james.lewis@bluestone.app.
A VAT bill loan is a financing option that allows organisations in the UK to borrow against their outstanding VAT bills. This type of loan provides a source of working capital to help organisations manage the cash flow impact of paying large VAT bills.
BS.202311.01FAQ27
A VAT bill loan benefits an organisation by providing quick and flexible access to working capital to help manage cash flow during periods of increased VAT payments. This type of loan can also help organisations avoid having to dip into their operating funds to pay VAT bills, preserving those funds for other important organisation needs.
BS.202311.01FAQ43
To be eligible for a VAT bill loan in the UK, an organisation typically needs to be VAT registered and have a good credit history. The specific requirements may vary depending on the lender and the loan product being offered.
BS.202311.01FAQ15
The repayment period for a VAT bill loan will depend on the loan amount and the repayment schedule agreed upon with the lender. The loan can typically be structured to match the timing of the VAT payments, helping to minimise the impact on the organisation's cash flow.
BS.202311.01FAQ75
There may be fees associated with a VAT bill loan, such as origination fees, documentation fees, and interest charges. These fees will vary depending on the lender and the loan product being offered. We would be happy to provide an estimate of the costs based on your specific needs and circumstances.
We know finance can be complex and often it's easier to talk things through. Drop us a message or give us a call 0330 135 8660 and we'll get back to you ASAP.
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