How many of your clients pay tax through self-assessment rather than PAYE?
And how often do some of those clients fall short when it comes to setting aside the correct provision to cover what they owe? This is the time of year when those clients will be considering their options and, fortunately there are a number of different ways to source funding to finance the payment of a tax bill.
Here are three solutions that could help you to help your clients get out of a tricky situation. A lender will generally want to know why the client didn’t have provision in place to pay the bill and will look for some reassurance that they are able to pay future bills, but there are more providers happy to lend on this basis.
Second charge mortgage
Second charge mortgages are becoming an increasingly competitive way for borrowers to raise funds on their existing property and it could be possible for your client to raise a second charge on their residential or buy-to-let property in order to fund the payment of the tax bill.
An increasing number of lenders are offering this type of borrowing as an equitable charge, where the lender doesn’t take a legal stake in the property but instead is given the right for a judicial process of recovery. An equitable charge can be used where the first charge lender declines their consent to a second charge being registered and can sometimes be processed faster than a traditional second charge mortgage.
Unsecured business loans allow businesses access to finance and are usually quick to arrange, which is why they are popular with clients who use them for short-term requirements.
This has become an attractive avenue for business owners as it can be achieved with minimal information, typically two years trading accounts and three months business bank statements will be enough to obtain an option for lending within 48 hours. Clients can also receive the funds as quickly as two weeks of submitting an application.
Short-term, or bridging, finance can provide a fast and flexible way to help your clients achieve the funding they need, including payment of a tax bill. Bridging finance is available on a first or second charge basis, on residential or investment property.
At Brightstar Financial, we have specialist experts in all of these sectors, and can work with you to identify the most appropriate route for your client.
So, don’t let this tax bill season pass without contacting your client database and seeing whether they have a payment due that you can help finance.
Have a client to refer now? Call our award-winning team on 01277 508 959 or CLICK HERE to submit an enquiry.
FOR INTERMEDIARY USE ONLY