Research from finance provider Premium Credit shows that SMEs are increasingly looking to spread the cost of their tax bills as they grapple with higher rates.
It saw a 20 per cent rise in the number of companies it helps spread the cost of VAT, corporation tax and self-assessment tax payments last year and a 24 per cent rise in total lending from the previous year as tax increases, including Employers’ National Insurance, hit SMEs.
Around 40 per cent of Premium Credit’s tax lending last year was for VAT bills, with 60 per cent of lending for corporation tax and self-assessment payments. Lending for VAT bills rose 23 per cent last year while non-VAT lending grew by 25 per cent.
Growth in 2025 builds on expansion in previous years – the number of customers has increased 58 per cent since 2023 while total lending has also increased by 58 per cent. Over the past two years non-VAT lending has increased by 61 per cent while VAT lending has grown by 54 per cent.
In 2025, the average size of a loan to help pay VAT tax bills was £126,600 – up 17 per cent on the previous year and 25 per cent over two years – while for non-VAT tax bills it was £70,200 compared with nearly £70,000 in the previous year and £73,600 in 2023.
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