VAT bill finance

Short-term finance for a VAT bill

A quarterly VAT bill is a known, dated liability — but it rarely lands when your cash does. A one-off short-term loan from Credicorp, £50 to £500, lets your limited company pay HMRC on time and repay over the next few weeks of trading. Interest is 0.25% per day on the principal plus a £5 one-off fee, and the total cost is capped at 100% of the amount borrowed.

UK limited companies and LLPs · No personal guarantee · Decisions most working days

Apply now Price your VAT bill

One-off business loan · £50–£500 · 14–84 days · 0.25% per day simple interest + £5 fee · cost capped at 100%.

Why a VAT bill catches good businesses out

If your company is VAT-registered you know the rhythm: you charge VAT on sales, reclaim it on purchases, and every quarter (or month) you pay HMRC the difference. The sum is predictable; the timing is brutal. A VAT bill that lands the same week as payroll, a supplier deposit and a customer who is paying you late is a genuine cashflow squeeze — even for a profitable, well-run company. The money you owe HMRC was never really yours; it was collected on every invoice and held until the return fell due. Bridging the gap is about timing, not solvency.

The bill arrives in a lump every quarter, but your income arrives day by day.
A single slow-paying customer can leave the VAT you have already collected tied up in unpaid invoices.
Miss the deadline and HMRC adds a late-payment penalty plus interest, and your filing record takes a hit.
Paying a business tax bill on a personal card or overdraft is expensive and mixes company and personal liability.

Helpful guide: how funding a VAT bill works

How bridging a VAT bill works

The mechanics are simple, and the loan is structured around a liability you already know the size and date of.

Borrow the bill amount Apply for a one-off short-term business loan sized to the VAT you owe. We lend to the company, so there is no personal guarantee to sign.
Pay HMRC on time Settle the VAT return by its deadline. You avoid the late-payment penalty and interest, and you keep a clean filing record — which matters if you ever need HMRC to agree a Time to Pay arrangement in future.
Repay from the next weeks of trading Clear the loan over a fixed short term as your invoices land and the next quarter's cash comes in. The repayment schedule is set out before you accept.
Settle early if you can Interest is charged on a simple daily basis on the principal, so paying ahead of schedule reduces the total cost. There is no early-settlement penalty.

What a VAT bridge could cost

Say your company owes a VAT bill of £500 and clears it over 56 days as the next quarter trades. With 0.25% per day simple interest on the principal and a £5 one-off establishment fee, here is the whole cost — every figure is from our live pricing.

VAT bill bridged: £500
Term: 56 days
One-off establishment fee: £5
Interest (simple, on principal): £70
Total to repay: £575
Roughly per week: £71.88 over 8 payments

Illustration only, not a quote. Use the calculator to price your own VAT bill and term.

Short-term borrowing is expensive relative to bank lending — only borrow when the cost is less than the penalty, interest and disruption of paying HMRC late. Total cost is capped at 100% of the amount borrowed, so you will never repay more than double. Lending is to the company; there is no personal guarantee.

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Talk to HMRC first

Short-term finance is not the only route, and it is not always the cheapest. Before you borrow, call HMRC's Business Payment Support Service and ask about a Time to Pay arrangement — a formal, phased plan for businesses with a genuine short-term cashflow difficulty. Ring them before the deadline, not after. A short-term loan is the right tool when HMRC will not engage, when you have used Time to Pay recently, or when paying in full and on time protects a record you would rather keep clean.

Phone HMRC before the payment deadline — a missed deadline hardens their position and adds a surcharge.
Time to Pay is usually the cheapest option when HMRC agrees to it; compare it against any loan cost.
If HMRC declines, or you have used Time to Pay recently for the same kind of bill, short-term finance is the next real option.
Whatever you choose, keep filing on time — a clean compliance record is worth protecting.

Who can apply

UK limited company or LLP (we lend to the body corporate — not to sole traders or individuals).
At least 6 months trading.
A current UK business bank account.
A director identity check (you act as the company's authorised representative, not as a personal borrower).
No personal guarantee required — the obligation sits with the company.

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VAT bill finance — questions

Can a limited company get short-term finance for a VAT bill?

Yes. A Credicorp short-term business loan can bridge a single VAT bill for a UK limited company or LLP. You borrow the amount you owe, pay HMRC on time, and repay the loan over a fixed short term from your next weeks of trading. Lending is to the company, so there is no personal guarantee.

Is this regulated consumer credit, and is my personal credit at risk?

No. Credicorp lends only to UK limited companies and LLPs under the body-corporate exemption in the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001. It is not a regulated consumer credit agreement, the Financial Ombudsman Service and Financial Services Compensation Scheme do not apply, and there is no personal guarantee — the obligation is the company's.

What does it cost to bridge a VAT bill?

It depends on the amount you bridge and how long you take to repay. Interest is 0.25% per day on the principal (simple, not compounding), plus a £5 one-off establishment fee, and the total cost is capped at 100% of the amount borrowed — so you never repay more than double. As a worked example, a £500 VAT bill bridged over 56 days repays £575 in total. Paying early reduces the cost.

Should I use Time to Pay with HMRC instead?

Often, yes — if HMRC will agree it. Time to Pay is a formal, phased arrangement for genuine short-term cashflow difficulty and is usually cheaper than borrowing. Call HMRC's Business Payment Support Service before the deadline. Short-term finance is the right choice when HMRC will not engage, when you have used Time to Pay recently, or when paying in full on time protects your filing record.

I am a sole trader — can I use this for my VAT bill?

Not as a sole trader. Credicorp lends to incorporated businesses only — limited companies and LLPs. If you trade as a sole trader you would need to incorporate first before this finance is available to you. Speak to your accountant about whether incorporating is right for your business.

How quickly can the money arrive?

Most decisions come back the same working day. Apply online in a few minutes; if approved, funds are typically released to your business bank account quickly so you can meet the VAT deadline.

Bridge your VAT bill

See exactly what a Credicorp business loan would cost against your VAT bill and term, then apply when it fits. Most decisions come back the same working day.

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Credicorp lends to UK limited companies and LLPs under the body-corporate exemption (Articles 60B and 60L of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001). This is not consumer lending; the worked example above is illustrative and not a personalised quote. The Financial Ombudsman Service and Financial Services Compensation Scheme do not apply. Full details: regulatory status and responsible lending policy.