2 min read
Why borrowers do it
A lump-sum VAT, PAYE or corporation tax bill can strain cash flow. A loan spreads it into manageable monthly payments and avoids interest, penalties and enforcement from HMRC. Check the repayment fits with the affordability calculator.
When to be careful
Borrowing to pay tax is fine for a timing gap; it is risky if it papers over a business that cannot generate enough cash. If tax bills recur unaffordably, address the underlying cash flow, not just this bill.
What it means for you
Credicorp lends to your company, not to you personally, and takes no personal guarantee. A no-personal-guarantee loan lets you clear a tax bill without putting your personal assets on the line. See business loans or apply online.
Frequently asked questions
Is it OK to borrow to pay tax?
Yes, it is a common and legitimate use that spreads the cost and avoids HMRC penalties, provided the repayments are affordable.
When is it a bad idea?
When the borrowing masks a deeper problem — a business that structurally cannot cover its tax. Fix the cash flow, not just this bill.
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Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.