Business Bridging Loan Rates 2026 — Updated October 2026
- Prime business security bridging
- From 0.65%/monthPrime business security bridging
- BoE base +4% = currently 7.75% p.a.
- HMRC TTPBoE base +4% = currently 7.75% p.a.
- Primary tax bridging use cases
- VAT, CT, PAYEPrimary tax bridging use cases
- Last updated
- October 2026Last updated
Business bridging loan rates in 2026 start from 0.65% per month for prime business security and run to 1.5%+ for complex or unsecured positions. The key business use case for bridging is tax payment — VAT, corporation tax, and PAYE bills that fall due before the business can fund them from cashflow. This guide shows the rate for business bridging alongside the HMRC Time to Pay (TTP) rate comparison — to help businesses decide which is genuinely more cost-effective.
Business Bridging Rates vs HMRC Alternatives — October 2026
Swipe the table sideways to see every column.
| Finance type | Rate | Monthly cost (£100k) | Comparison note |
|---|---|---|---|
| Business bridge — prime property security | 0.65%–0.85%/month | £650–£850/month | Secured on property. Fast (24–48hr). Fixed rate for term. |
| Business bridge — commercial property security | 0.85%–1.25%/month | £850–£1,250/month | Commercial asset as security. Standard business bridge range. |
| Business bridge — unsecured (debenture/PG) | 1.25%–2.0%/month | £1,250–£2,000/month | No property security. Higher rate reflects unsecured position. |
| HMRC Time to Pay (TTP) — if approved | BoE base + 4% = 7.75% p.a. | £521/month (interest only) | Simple interest, no compounding. No arrangement fees. No guaranteed approval. |
| HMRC late payment penalty (after 30 days) | 5% of outstanding tax | £5,000 one-off then ongoing interest | Significantly more expensive than bridging if deadline missed. |
| HMRC standard interest (no TTP) | BoE base + 4% = 7.75% p.a. | £521/month + late penalties | TTP must be agreed before deadline — not retrospective. |
What determines your rate
Security available
A property charge (first or second) provides the best business bridge rate. A business with a commercial property can typically bridge at 0.75%–1.0%/month. Without property security, the lender relies on a debenture over business assets and/or personal guarantee — which pushes rates to 1.25%–2.0%+.
Tax vs HMRC Time to Pay comparison
HMRC TTP (if approved) charges simple interest at base rate + 4% (currently 7.75% p.a. = 0.65%/month, unchanged from August 2026; HMRC reviews the rate quarterly, next review October 2026). This is lower than a secured bridge at 0.65%/month — on first appearances. However: TTP is not guaranteed (HMRC decides whether to approve), requires proactive agreement before the due date, and failure to pay on time results in 5% penalty plus ongoing interest. A bridge guarantees the payment, avoids penalties, and provides certainty.
Term
Tax bridging loans are typically short — 3–6 months, occasionally to 12 months while the business improves cashflow. Shorter terms reduce total interest cost significantly relative to a longer-term finance option.
Loan size
VAT quarters typically fall in the £20,000–£200,000 range for SMEs. Corporation tax bills can be larger. Business bridge lenders are active across this range. Above £500,000, specialist and private banking options become relevant.
Speed
Tax bills have hard deadlines. A business bridge can be arranged in 24–72 hours where security is clear. HMRC TTP requires proactive contact before the deadline — if the deadline has already passed, TTP is harder to negotiate and penalties are already accruing.
Worked cost example
- Total cost of bridging
- £4,840
- Total cost of TTP (interest only)
- £3,100
- 3-month total cost
- £5,550 — more expensive than bridging
Comparison: £80,000 VAT bill due immediately. Two options:
Option 1 — Business bridge at 0.85%/month (residential property security, 3-month term)
Monthly interest: £680. Total interest 3 months: £2,040.
Arrangement fee (2%): £1,600. Legal fees: £1,200.
Option 2 — HMRC Time to Pay (7.75% p.a. = 0.65%/month) — if approved, 6-month TTP
Monthly interest: £517. Total interest 6 months: £3,100.
No arrangement fee. HMRC admin time required.
Option 3 — Missed deadline (30-day penalty + ongoing interest)
5% penalty: £4,000 immediately. Ongoing HMRC interest: £517/month.
TTP is cheaper than bridging IF approved. Bridging is better than missing the deadline entirely.
Terms the same working day — no upfront fees on loans over £1m
The figures above are indicative and describe the best case. Send your own scenario and we will come back the same working day with terms from the lenders that actually fit it.
- Enquiry type
- Bridging Loan
- About
- Business Bridging Rates
No upfront fees on loans over £1m.
Enough detail to price it is the amount, the security, the purpose and how you plan to repay. The rest we can fill in on a call.
Whole of market · 130+ lenders · FCA 814533 · Same working day response
Rate context and outlook
Bank Rate is 3.75% after the 17 September hold, with three MPC votes for a rise and the next decision on 5 November. Bridging pricing follows lender funding costs and swap rates rather than Bank Rate directly.
The latest Bridging Trends average was 0.81% per month, with average LTV of 55% and completion in 46 days. We expect standard-band pricing to hold in the 0.65%–0.95% range through Q4 2026, with upward pressure on the most competitive prime products if swap rates stay high.
Reviewed by David Doulton, Director, Doulton Bridging Finance — over 20 years in property finance. Last reviewed 1 October 2026. Doulton Money Ltd t/a Doulton Bridging Finance, FCA No. 814533.
Frequently asked questions
Is a business bridge or HMRC Time to Pay better for a tax bill?
If TTP is available and approved before the due date, TTP is slightly cheaper in pure interest terms — 7.75% p.a. versus 7.8%–10.2% p.a. for a secured bridge. However, TTP is not guaranteed — HMRC decides whether to approve. A business bridge guarantees the payment is made on time, avoids penalties entirely, and preserves the HMRC relationship. For businesses where TTP approval is uncertain, bridging is often the lower-risk choice despite the slightly higher interest cost.
How quickly can a business bridge for a tax bill be arranged?
Where property security is clear (residential or commercial property with no complicating factors), a business bridge can be arranged in 24–72 hours. The main time factors are: identity verification, property valuation (automatic valuation model for straightforward residential), and legal documentation. For genuinely urgent deadlines, contact us as early as possible — we maintain relationships with lenders who can respond in hours rather than days.
Can I bridge a PAYE bill as well as VAT?
Yes — business bridging for PAYE liabilities is available on the same terms as VAT bridging. The key factors are the same: security available (property, business assets, personal guarantee), loan amount, and the business's ability to repay from cashflow within the bridge term.
Does my company need to be profitable to get a business bridge?
Not necessarily — a business bridge is primarily secured against an asset (usually property) rather than assessed on profitability. A temporarily loss-making business with a property asset can often bridge a tax liability. The critical factors are: the quality of the security, the clarity of the exit (when will the loan be repaid), and the business's underlying viability.
What happens if I cannot repay the business bridge at the end of the term?
Business bridge lenders assess exit strategy carefully at the outset — the bridge should not be entered without a clear, credible repayment plan (property sale, refinancing, expected cashflow). If repayment is delayed, most lenders allow a term extension at a slightly higher rate. If the borrower defaults entirely, the lender enforces against the security. We advise on realistic exit planning before any bridge is entered.
How quickly can a bridging loan complete?
Typically 2–4 weeks; the latest market average is 46 days. Urgent cases with clean title and a quick valuation can complete in 7–10 working days.
What fees come on top of the interest rate?
An arrangement fee of 1%–2%, valuation of about £500–£1,500, legal fees of £1,500–£3,000 for both sides, and on some products an exit fee of up to 1%.
Can the interest be rolled up?
Yes. Most bridges roll interest into the loan and repay it at the end, so there are no monthly payments; serviced and retained interest are also available.
What exit strategies do lenders accept?
A sale, a refinance to a mortgage, or other funds such as an inheritance or business sale. The stronger the evidence, the better the rate.
Can I get a bridging loan with bad credit?
Often, yes. Lenders focus on the property and exit; recent defaults or CCJs usually move you up a pricing band rather than rule you out.
Is a bridging loan regulated?
Only when it is secured on a home you or your family live in or will live in. Investment and business bridges are unregulated.
Where this applies
Talk to us about
Get a personalised rate comparison for your case
Independent whole-of-market advice · FCA No. 814533