VAT and tax bill spreader

VAT quarters and corporation tax payment dates can collide with payroll, stock purchases and slow-paying customers. Paying HMRC in one lump sum avoids interest but can drain working capital. Spreading the same liability over months keeps cash in the business — at a cost you should understand before committing.

This calculator compares the day-one outflow of paying in full against the total you would repay when spreading at a representative APR, plus the monthly payment for your chosen term.

If you expect a short-term cash gap, HMRC Time to Pay may be available for VAT, PAYE or corporation tax — contact HMRC before the due date. Arrangements are discretionary and not guaranteed. When you need longer spreading, or HMRC cannot agree a plan, specialist tax and VAT funding from commercial lenders is an alternative this tool helps you cost.

Commercial facilities are not HMRC schemes. Interest applies, and providers will assess your file. Always explore Time to Pay first where appropriate — this calculator is for comparing financed spreading, not replacing HMRC dialogue.

A £50,000 corporation tax bill spread over twelve months at 14% representative APR might cost around £4,500 per month with roughly £3,900 in total interest — versus £50,000 leaving the account on day one if paid in full. Run your own bill amount and rate above; the cost as a percentage of the bill summarises the premium for liquidity.

When the figures look workable, use Get my exact figure for tax and VAT funding from Tera's panel — no broker fee to you. If your broader question is how much the business could borrow overall, start with the borrowing capacity calculator.