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How Invoice Financing Can Improve Cash Flow

It’s one of the main issues that B2B suppliers face, particularly SMEs and sole traders. When a product or service is supplied to another business and an invoice raised, there is generally a delay before payment is made. It can take on average 30 days before funds return to your business and can be reinvested, used to cover running costs or get more product out into the marketplace. In many instances, especially when in partnership with large corporations such as supermarkets, this invoice payment delay can be anything up to two to three months.

That’s a long period when valuable cash flow is stalled.

Obviously, this situation causes problems for small and medium sized businesses working on tight or limited budgets. Invoice financing is designed to help companies get over this problem. When an invoice is raised, financing can be taken out to provide immediate payment, rather than having to wait until the invoiced company pays up. Once that invoice is fully recovered, the loan is simply paid back.

Cash flow is important to all businesses but more so to SMEs and sole traders who generally have to compete within tight margins. Getting the right invoice financing in place to ensure that money is available when a business most needs it is part of accepted operating strategies nowadays. That means a business isn’t left on hold while they are waiting for payment to be received. They can implement growth strategies and deliver more products and continue to thrive rather than treading water and twiddling their fingers while the client account department hangs onto that invoice.

For business to business companies that rely on a flexible cash flow to compete in their markets, invoice financing is the perfect solution for the immediate release of finances. It allows them to introduce working capital, pay wages and focus more on the future.

At PFC, we have access to a range of funders and can provide invoice financing to businesses across a wide spectrum, from those that have been operating for a while to start ups that have less of a credit history. It’s not just about providing loans to cover these payments, allowing companies to continue to operating effectively. It’s also about building strong relationships that are designed to deliver the financing options many SMEs and owner managed sole traders are looking for to make their businesses more competitive.

Spread the Impact of your Partnership Tax Bill with Tailored Tax Funding

Partnership tax generally costs more as a whole than corporation tax and working out each member’s liability can be difficult at the best of times. This can affect businesses such as architects, lawyers and accountants who share a common cause but often operate as self-employed entities within the partnership.

Making sure everyone in the partnership is well equipped for dealing with the tax payments due in January can ensure your business runs more smoothly and everyone stays on track and can meet their commitments. Swapping a one of payment to the HMRC for tax funding, where you basically get a loan for the amount you are liable for and pay it over monthly instalments can relieve a huge amount of pressure on practices.

At PFC we offer tailored, private tax funding that helps businesses working through partnerships to spread their liability over a short term period of 6 to 12 months. Most businesses falter when faced with unexpected financial settlements such as tax bills and having a way to ameliorate that impact can make a huge difference to the day to day operation of all partners.

The Benefits of Tax Funding for Partnerships

  • It spreads the cost of tax payments across a longer period, making sure that partners don’t have to find valuable funds as the deadline for HMRC returns approaches.
  • It allows partners to know where their tax liability lies and how much they need to pay each month rather than trying to get the payment together at the last minute.
  • Some partners are better at dealing with cash flows and tax liabilities than others and introducing tax funding can make sure additional pressure isn’t put on their capabilities because of the failures of another member of the team.
  • It gives breathing space for the partnership that allows it to grow and develop especially at a time of year when business is naturally slower.
  • The loan can be made by an individual who is self-assessing, to make sure liabilities are covered, or by the partnership as a whole to ameliorate any unforeseen charges.

How it Works for Partnerships

At PFC we’ve got a fair deal of experience in dealing with all aspects of tax funding for corporations, self-assessors and partnerships. With access to private funding that can be tailored to individual needs, we can work with you to find the right solution that suits your business. Payments can be made either directly to the HMRC or to the partner or partnership concerned and repayments can be spread over 6 to 12 months.

Tax funding is available for small and large partnerships whether the bill is just a few thousand pounds or much larger. If you want a solution that makes it easier to pay your all-important tax bill, then contact our highly skilled and professional team today.

The Unavoidable Truth

They say that there are only two things you can be sure of in life and they are death and taxes. The good news however is that there are measures that you can do in both cases that prolong life or reduce the impact of taxes on your business or personal cash flow.

Many will have the first in hand with ‘Dry January’ or various New Year resolutions to get fit, eat more healthily or give up smoking in an effort to live a healthier and hopefully longer life. When it comes to managing taxes, unfortunately you can’t put off the inevitable deadline of 31st January for self assessment tax returns, however there are plenty of options to consider if looking to secure funding and help manage the tax bill payment.

With a range of lenders making up PFC’s funding panel, no tax bill is too great or too small. In addition, there is a specialist team on hand to provide a quick decision making process and advise on the required levels of funding, your preferred terms and how repayments can be structured to allow you to budget for manageable repayments.

Arrangements can be made for payment to be made directly to HMRC or into an office account, typically within a week of the application. The repayments are in turn arranged in line with the liability so typically between 6 and 12 month terms for self-assessment tax funding.

Having the flexibility of a short term loan for tax liabilities allows you to spread the cost of the liability into manageable monthly payments to assist with the budgeting in the company, help ease cash flow and relieve the pressure of having to find a lump sum payment.

The short term, unsecured fixed rate loan facilities offered by PFC cover all types of tax funding including; Schedule D tax, corporation tax or capital gains tax to name a few. With the right tax funding support in place it can give individuals and businesses a new lease of life by removing the worry and freeing cash for other business priorities.

It’s also good to know that with your tax taken care of there’s a weight off your shoulders and a great stress relief. Maybe with this support you can take care of two of life’s certainties by better managing your tax and in turn potentially living a longer stress free life.