Business finance for limited companies, LLPs & partnerships — what about sole traders?

Summary — Yes: most mainstream business finance products are routinely available to UK limited companies, LLPs and partnerships. Sole traders can sometimes access similar products but availability, loan size and terms often differ because lenders underwrite them against personal credit and trading records. UK Business Loans does not lend directly — we match limited companies, LLPs and partnerships (and other eligible businesses) with lenders and brokers who can assess your options. Get Quote Now — Free Eligibility Check

Quick summary — the short answer

• Most lenders are comfortable lending to limited companies and LLPs because they have a separate legal identity and standard accounts.
• Partnerships are commonly funded; underwriting focuses on partnership agreements, turnover and partners’ credit where applicable.
• Sole traders can be eligible with many lenders, but lenders often place greater emphasis on the individual’s personal credit, tax records and bank statements — and may offer smaller limits or higher costs.
• UK Business Loans can quickly match Ltd companies, LLPs and partnerships to lenders/brokers that specialise in your sector. Free Eligibility Check

Why legal structure matters to lenders

Lenders need clarity on who they can contract with, where security can be taken, and how debts might be recovered. Legal structure changes those calculations.

Limited companies & LLPs

Limited companies and LLPs are separate legal entities with distinct financial records (company accounts, balance sheets, director information). Lenders like this because:

• Accounts can be filed at Companies House and are often audited or prepared by accountants, making verification easier.
• Security (fixed or floating charges) can be taken over company assets or assigned receivables.
• Directors’ personal liability is limited (unless personal guarantees are requested), which creates clearer recovery routes.

Partnerships

Partnerships (general or limited partnerships) are usually assessed on business performance and partners’ personal standing. For funding that depends on contract assignment or property security, lenders will check partnership agreements and whether assets can be pledged.

Sole traders

Sole traders have no separate legal personality. Lenders underwrite the person behind the business, which means:

• Personal credit history and personal tax records (SA302) often dominate underwriting.
• Security options can be limited to personal assets.
• Limits and pricing are frequently more conservative compared with corporate borrowers.

Which business finance types are commonly available by entity

Below is a practical guide showing typical lender preferences. Note: product availability always depends on lender appetite, borrower profile and sector risk.

Business loans (secured / unsecured)

Limited companies / LLPs / Partnerships: Widely available. Lenders prefer company accounts but will lend on solid trading history. Loans from £10k and up are common.

Sole traders: Often eligible for smaller unsecured loans; secured options possible but may require personal guarantees.

Commercial mortgages & property finance

Limited companies & LLPs: Common — lenders accept corporate ownership and take property as security.

Partnerships: Usually funded if the partnership owns the property and partners agree to security.

Sole traders: Can access buy-to-let or commercial mortgages but often with stricter underwriting and smaller maximums.

Asset & equipment finance

All business types can usually access asset finance; finance houses commonly support Ltd companies and LLPs but will consider partnerships and sole traders if evidence of trading and cashflow is strong.

Invoice finance / factoring

Lenders favour businesses that can assign invoices and demonstrate creditworthy customers. Ltd companies and LLPs often fit easily; partnerships can qualify; sole traders sometimes accepted, depending on turnover and debtor quality.

Merchant cash advances

Widely available across entities where card turnover exists. Lenders look at processing history more than structure, though corporate entities may secure bigger facilities.

Short-term bridging & development finance

Typically aimed at companies and SPVs; lenders prefer clear exit plans. Partnerships may be considered; sole traders are less commonly funded for large developments.

Green & sustainability loans

Available to Ltds, LLPs and partnerships that can show project feasibility and cashflow. Some lenders will fund sole traders for smaller installations if there’s strong trading evidence.

Construction / contract funding

Lenders often prefer limited company contractors because contracts can be assigned and retentions handled more easily. Sole traders can access invoice or contract-based funding but usually at smaller sizes and with stronger personal security requirements.

Common underwriting differences (what lenders check)

Underwriting is where entity type most affects outcomes. Common checks include:

• Business accounts and management accounts (company accounts for Ltds/LLPs).
• Trading history and turnover consistency.
• VAT returns, bank statements and cashflow projections.
• Personal credit checks for directors, partners or sole traders where personal guarantees are required.
• Evidence of contracts, purchase orders or invoices (especially for invoice finance or contract funding).
• Security offered: property, plant, stock, or director/partner guarantees.

Note: For sole traders, expect much more focus on personal tax and credit records.

Documents you’ll usually need (by entity)

Preparing documents speeds decisions. Typical requirements:

Limited companies & LLPs

• Latest company accounts (filed at Companies House), management accounts.
• Business bank statements (3–6 months).
• VAT returns (if applicable), evidence of contracts or invoices.
• Company registration number, director ID and proof of address.
• Cashflow forecast or business plan for larger loans.

Partnerships

• Partnership accounts, partnership agreement, bank statements.
• Personal IDs and tax details for partners if required.

Sole traders (overview)

• Personal ID, SA302 tax calculations or tax year overviews, bank statements and proof of trading.

Get Quote Now — Free Eligibility Check and we’ll send a tailored document checklist for your business type.

Why some lenders decline sole traders (and how to improve chances)

Common reasons lenders are cautious with sole traders:

• No separate legal entity — lending is against the person not a corporate vehicle.
• Personal tax records (self-assessment) can be harder to interpret than company accounts.
• Less scope for security and often lower turnover scales.

How to improve chances (if you are eligible or considering a change):

• Incorporate as a limited company or form an LLP (if appropriate) to access larger facilities and clearer accounts.
• Keep clean and separated business banking and up-to-date accounts prepared by an accountant.
• Build formal contracts and client paperwork to demonstrate cashflow certainty.
• Use a broker experienced in your sector to match you to lenders who accept your entity type.

Two sector examples (construction & sustainability)

Construction — typical lenders and entity preferences

Construction funders (invoice funders, contract finance, bridging/development lenders) often prefer limited companies because:

• Contracts and retentions can be assigned; company accounts show project turnover.
• Corporate structure simplifies the creation of SPVs for development projects.

Sole traders and small partnerships can get funding for materials or short-term cashflow, but limits are usually smaller and personal guarantees more common. If you need sector-specific support, Get Quote Now — Free Eligibility Check.

Sustainability projects — solar, EV chargers, heat pumps

Green finance is increasingly available to businesses of all structures where project costs and savings are clear. Limited companies and LLPs typically access larger sustainability loans and grants more easily, while smaller contractors can fund installations using asset finance or green-specific lenders. Start with a quick eligibility check: Free Eligibility Check.

How UK Business Loans helps — fast matching, no obligation

UK Business Loans does not lend. We connect limited companies, LLPs and partnerships with a panel of lenders and brokers that suit your sector and funding size (we typically arrange loans from around £10,000 upward). Our process is quick and non-binding:

1. Complete a short enquiry with basic business details.
2. We match you to lenders/brokers that commonly fund your type of business.
3. Partners make contact to discuss options and next steps.

Get Quote Now — Free Eligibility Check — it only takes a couple of minutes and does not commit you to anything.

For more background on business funding options and to explore tailored solutions, see our guide to business finance.

Frequently asked questions

Next steps — ready to check eligibility?

If you run a limited company, LLP or partnership and want to explore options quickly, start with a short enquiry. We’ll match you to lenders and brokers who commonly work with your business type and sector. Get Quote Now — Free Eligibility Check

Legal, compliance & transparency

UK Business Loans is an introducer — we do not provide loans or regulated financial advice. When you submit an enquiry, we will pass your details to selected lenders and brokers who may contact you about funding options. Submitting an enquiry is not a credit application and will not affect your personal credit score. All promotional claims on this page are intended to be clear, fair and not misleading.

Image suggestion: add a header image with alt text “UK business loans for limited companies, LLPs and partnerships”.

1. Can sole traders get business loans?
Yes — many lenders consider sole traders but underwriting usually focuses on personal credit, SA302 tax records and bank statements which can mean smaller limits or higher costs.

2. Do lenders prefer limited companies, LLPs or partnerships?
Yes — lenders generally prefer limited companies and LLPs because separate legal identity, filed accounts and clearer security options make larger or secured facilities easier to underwrite.

3. What types of business finance can I access for a limited company, LLP or partnership?
You can be matched to providers offering business loans, commercial mortgages, asset/equipment finance, invoice finance, merchant cash advances, bridging/development finance and green/sustainability loans depending on lender criteria.

4. What documents do lenders typically ask for?
Commonly requested documents include filed company accounts or SA302 tax calculations, 3–6 months of business bank statements, VAT returns (if applicable), evidence of contracts or invoices and ID for directors/partners or sole traders.

5. How long will it take to hear back after submitting an enquiry or free eligibility check?
After you submit our short, non‑binding enquiry and free eligibility check many brokers and lenders respond within hours and typically within 24–48 hours depending on complexity.

6. Will submitting an enquiry through UK Business Loans affect my credit score?
No — submitting an enquiry is not a credit application and will not affect your credit score, although lenders may carry out checks if you proceed with a formal application.

7. Do lenders usually require personal guarantees?
Some lenders do request personal or director/partner guarantees—particularly for sole traders, smaller businesses or where business assets are insufficient—while others will accept corporate or property security instead.

8. What is the minimum loan size you arrange?
We generally work with partners who arrange loans from around £10,000 upwards, with exact minimums varying by product and lender.

9. Are the lenders and brokers you introduce regulated?
We introduce you to reputable lenders and brokers and your matched partner can confirm their specific FCA regulation status before you apply.

10. How can a sole trader improve their chances of securing business finance?
Improve your chances by separating business banking, keeping up‑to‑date accounts or SA302s prepared by an accountant, formalising client contracts and considering incorporation or using a specialist broker to find lenders that accept sole traders.