- Who it's for
- UK Ltd companies and PLCs with a corporation tax bill due to HMRC
- Typical amounts
- £5,000 up to £1,000,000, matched to the tax bill due
- Typical terms
- 3 to 12 months
- Minimum turnover
- £100,000 a year to use Lending Box
- Security
- Usually unsecured with a personal guarantee
Indicative only. Subject to lender assessment and approval.
Who it's for
- Profitable companies facing a larger-than-usual corporation tax bill.
- Businesses that reinvested a strong year's profit into the business and now need to fund the resulting tax bill separately.
- Companies wanting to preserve cash reserves for operations rather than clearing the whole tax bill at once.
- Businesses that would rather plan predictable monthly repayments than one large payment to HMRC.
How it works
- 1You tell us the corporation tax amount due and the payment deadline from HMRC.
- 2We review your bank statements and latest accounts to match you with lenders who can fund in good time.
- 3Funds are released to your business account to pay HMRC directly.
- 4You repay the loan in instalments over the agreed term.
Why corporation tax catches businesses out
Corporation tax is due a significant time after the accounting period it relates to, which can create a mismatch between when profit is earned and when the cash is actually needed.
- A strong trading year's profit may already be reinvested in stock, equipment or growth by the time tax is due.
- Growing businesses in particular can find each year's tax bill larger than the last, outpacing cash reserves set aside.
- An unexpected one-off profit, such as an asset sale, can create a larger bill than usual.
HMRC Time to Pay vs commercial finance
As with VAT, HMRC may agree to spread a corporation tax bill directly, which is worth considering alongside commercial finance.
- A Time to Pay arrangement is agreed directly with HMRC and avoids a separate lender relationship or credit search.
- Commercial finance may offer more flexibility or speed, particularly where HMRC has already declined or where you'd rather keep the relationship with HMRC straightforward.
- Comparing total cost between the two is worth doing before committing to either.
Planning ahead for next year's bill
A loan solves this year's problem; a few habits can reduce the need for one next time.
- Setting aside an estimated percentage of profit into a separate account throughout the year, ready for the tax bill.
- Reviewing management accounts regularly so the likely tax liability isn't a surprise nine months later.
- Discussing tax planning and payment timing with your accountant as part of regular reviews.
How a broker helps
As with VAT, timing matters because HMRC deadlines are fixed. As a whole of market broker, we focus on lenders who can realistically fund in time and set out the total cost clearly. Our service is free to your business; we're paid a commission or finder's fee by the lender if finance completes, as set out in our Broker Terms.
Eligibility
- A UK limited company or PLC (not sole traders, partnerships or LLPs for corporation tax specifically).
- Annual turnover of at least £100,000.
- A confirmed corporation tax liability with a clear payment deadline.
- A business bank account showing income that supports the repayments.
- Directors willing to give a personal guarantee, in most cases.
Documents you'll need
- The corporation tax computation or HMRC confirmation of the amount due.
- Latest filed accounts.
- 3–6 months of business bank statements.
- Details of any existing finance and its repayments.
- Photo ID and proof of address for directors.
Advantages
- Keeps cash available for day-to-day operations rather than one large payment depleting reserves.
- Can be arranged relatively quickly since the amount due is a fixed, verifiable figure.
- Useful after a strong trading year where profit has been reinvested rather than held as cash.
- Helps avoid late payment penalties and interest from HMRC by meeting the deadline.
Things to weigh up
- Adds a finance cost on top of the tax itself, which is worth weighing against the alternative of simply budgeting for it in advance.
- If profits are consistently strong, it may be more cost-effective over time to set aside tax reserves monthly than to borrow each year.
- A personal guarantee is common, adding personal exposure for directors.
- Short terms mean relatively higher monthly repayments than a longer facility.
Worked example (illustrative)
A software company had a strong year, generating a corporation tax bill of £48,000 due in three weeks. Profit from the year has already been reinvested in new hires.
A specialist lender offers a loan of £48,000 over 10 months to cover the bill, with repayments matched to the company's monthly income.
Using the business loan calculator below, £48,000 over 10 months at an illustrative 15% a year works out at roughly £5,075 a month. The real rate depends entirely on the lender's assessment.
Business loan calculator
Monthly repayment
£2,307.25
- Total repayment
- £55,373.91
- Total interest
- £5,373.91
Representative example: borrowing £50,000 over 24 months at 10% a year would cost £2,307.25 a month, £55,373.91 in total, including £5,373.91 interest.
Illustrative only. Your actual rate depends on your circumstances. Indicative only. Subject to lender assessment and approval.
Frequently asked questions
Related guides
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Lending Box helps UK businesses access business finance, working directly with businesses and their trusted advisers. We are a credit broker and do not provide loans ourselves. All finance and quotes are subject to status and income. Applicants must be aged 18 or over, and terms and conditions apply. Guarantees and indemnities may be required. Lending Box can introduce applicants to a number of providers based on each applicant's circumstances and creditworthiness. We can also make insurance introductions. Lending Box will receive a commission or finder's fee for arranging such finance and insurance introductions. Broker Terms