As we emerge from the worst recession for nearly 100 years, you would be entitled to think that an increase in patient numbers and business levels eases cash flow concerns.
However, whilst this can be the case, expanding businesses can continue to find cash flow a delicate issue as running costs escalate in order to fuel the increased business levels.
The annual tax bill
One hurdle to overcome is the annual tax bill, and as January rolls around those that have enjoyed improved performance are faced with a reminder that it doesn’t come without cost.
Indeed, even those with stable turnover and profits still need to dig deep, HMRC always wants its slice of the cake.
It has to be said that the Government could have chosen a better time for the larger of the two tax bills (January and July) to be paid.
Many practices suffer a quiet December due to Christmas; more time off and lower revenues. January can also be a quiet time for many so when the tax demand arrives you can be forgiven for feeling like you are being kicked when you’re down!
Taking the sting out of the tail
Help is at hand though, the growing willingness of lenders to provide funding for tax is a welcome cash flow facility. An easy-to-arrange six, nine or 12-month loan can take the sting out of the HMRC demand and allow you to balance repayments over the year to even out cash flow and provide some welcome respite.
These facilities have grown in popularity, not only with practice owners but locums and associates alike, so it’s worth looking into.
A simple process
Arranging a short-term loan to cover some or all of your tax is a very simple process, it should also be cost effective as you are only paying interest over a short period.
With competitive rates and easy credit approvals, it’s no wonder tax loans are becoming more popular year on year.
For more information on Performance Finance Ltd please email [email protected] or call 01536 529696.