£1m tax loan secured for hospitality business

PMD were approached by a national accountancy firm who introduced their hospitality client who was burdened by a COVID-related financial strain. The client faced a HMRC liability of £1.5m and was subject to a Winding Up Petition.  

If the petition had been advertised, the business would have lost its contracts, rendering it non-viable and resulting in 30+ redundancies. The key challenges were time constraints and lack of security, given the nature of the business. 

Mark Millhouse, Head of Invoice Finance, engaged with the client to understand their needs and collaborated closely with accountants and lawyers. The legal team negotiated a Time to Pay (TTP) for £500k of the debt, while PMD focused on securing a loan for £1m to meet HMRC’s immediate payment requirement. 

With less than 24 hours to the deadline, one lender withdrew, leaving a £250k shortfall. The lead lender and PMD helped to bridge the gap via a second charge on the director’s property, working overnight to complete legal documentation and ensure funds reached HMRC by 12pm, with help from Business Support Advisor, Jamie-Leigh. 

The urgent tax loans safeguarded 30+ jobs and preserved the company’s contracts, preventing business failure.

PMD is now working on refinancing assets within the business to repay short-term funding and release the lender’s security.