When souring finance for vehicles, construction equipment and many other assets the upfront costs can be large; especially the VAT element. VAT can take up to three months to recover leaving business cash flow tight.

One option to help is a product addition called a VAT deferral which can be used for up to 4 months subject to application and approval. The funder meets this cost of the customer’s VAT. This means the customer can avoid paying the VAT upfront and manage their cash flow.

The customer will then pay the VAT element with their direct debit. The term of the VAT deferral can be between 1 to 4 months.

The customer submits the VAT claim with a copy of their finance agreement straight away to the HMRC. This will ensure they receive the VAT element back in time to meet their VAT payment.

If you have a large purchase you are holding off on please call us today to discuss VAT deferrals – 01889 221800.