Quick answer

Yes — accountancy and legal firms commonly use refinancing as one tool to manage timing mismatches between client fees and fixed monthly costs such as payroll. Refinancing can restructure existing debt (consolidate loans, extend terms, or release equity) to smooth monthly repayments, reduce short‑term pressure and create predictable cashflow. That said, it’s not always the best or cheapest option: refinancing may lengthen the debt and increase total interest or require security. This page explains practical options, risks, alternatives and the documents lenders typically ask for. Ready to compare lenders? Get a Free Eligibility Check — Get Quote Now.

Important: UK Business Loans is an introducer — we do not lend and we do not provide regulated financial advice. We match businesses with lenders and brokers who will carry out suitability and affordability checks.

Why fee cycles and payroll cause cashflow problems for professional firms

Professional services often have uneven revenue timing that can create regular cash gaps:

• Retainer and staged billing: work billed in stages or via retainers can create months with low invoice receipts.
• Completion or settlement delays: solicitors and litigators may wait long periods for Bills of Costs or settlements.
• Seasonal peaks: accountants often face concentrated revenue at year‑end or tax season, with quieter months elsewhere.
• Large payroll commitments: monthly PAYE, pension contributions and regular salaries are fixed costs that must be met regardless of when clients pay.

Here’s why it matters: missed payroll damages staff morale and retention, and regular overdraft use can be costly or hit borrowing limits. Quick tip: map your inflows vs payroll dates to see recurring shortfalls before choosing finance.

What is refinancing (brief explainer)

Refinancing for a business means replacing or restructuring existing borrowing to improve terms, consolidate debts, extend repayment periods or raise additional funds. Typical goals include lowering monthly repayments, reducing interest rates, or freeing up working capital by releasing equity in property or assets.

Refinancing differs from other cashflow products:

• Invoice finance unlocks cash from unpaid invoices (good for firms with high receivables).
• Overdrafts are short‑term flexible credit but can be expensive for sustained use.
• Bridging loans are short-term and usually for specific one-off timing gaps.

How professional service firms can use refinancing to manage fee cycles & payroll

1) Consolidate multiple loans to simplify payments

Many practices have a mix of overdrafts, equipment loans and director loans. Combining them into a single term refinance loan can reduce admin and sometimes lower overall monthly repayments. Example: a regional accountancy practice consolidated three facilities to turn several high monthly commitments into one predictable payment.

2) Extend term to smooth monthly repayments

Extending the term of a loan lowers monthly payments, easing short-term cash stress. In practice, this can free cash to cover payroll during months with delayed receipts — but note total interest can increase.

3) Refinance to a cheaper rate to free cash

If current borrowing carries a higher rate, refinancing to a lower rate can reduce interest spend and improve monthly cash available for operations, including wages.

4) Release equity or re‑leverage assets

Firms that own premises can refinance commercial mortgages to release equity as working capital. This is common for established legal or accounting practices with property on their balance sheet.

5) Combine refinancing with flexible products

In many cases a blended approach is best: refinance core debt for predictability, and add invoice finance or an agreed overdraft for short cash timing gaps. Example: a solicitor combined a refinance to reduce monthly repayments with invoice finance for client retainer delays.

Each strategy requires careful modelling: use a 12‑month cashflow forecast showing invoicing, receipts and payroll to see how different refinance outcomes affect liquidity.

Pros and cons of using refinance for payroll & fee-cycle management

Benefits

• Predictable monthly payments make payroll planning easier.
• Lower monthly outgoings (if term extension or rate reduction achieved).
• Debt consolidation simplifies admin and may improve lender relationships.
• Equity release can provide larger, one‑off working capital injections.

Risks and downsides

• Longer terms often increase total interest paid — cost vs cashflow trade‑off.
• Large refi amounts may require security (property charges) or personal guarantees.
• Break costs or early repayment fees on existing facilities can erode savings.
• Lenders may impose covenants limiting dividends, director drawings or additional borrowing.

Quick reminder: consider speaking to a specialist broker or tax adviser before proceeding — UK Business Loans can introduce you to partners who help you compare offers. Get a Free Eligibility Check.

When refinancing is (and isn’t) the right option — decision checklist

Use this checklist to decide if refinancing makes sense:

• Is the cash shortfall recurring (monthly/seasonal) rather than one-off?
• Are current loan rates or repayments higher than market alternatives?
• Do you have assets or property you’re willing to offer as security if needed?
• Have you modelled total cost (interest + fees + potential break costs) over the new term?
• Is your management accounting up-to-date (lenders prefer recent management accounts)?

Alternatives to refinancing to consider: invoice finance, short-term bridging or merchant finance. Compare options — if you’re uncertain, Get Quote Now and we’ll match you with brokers who specialise in professional firms.

Typical refinancing products and terms used by professional firms

Common options for practices:

• Secured business loan / term loan: fixed monthly repayment, may require property or charge.
• Commercial mortgage refinance: replace existing commercial mortgage to release equity or improve terms.
• Debt consolidation loan: roll multiple debts into a single facility.
• Asset‑secured refinance: borrow against plant, fixtures or receivables.

Key terms to check: interest type (fixed vs variable), term length, early repayment charges, APR/representative rate, covenant terms and security required. Always ask lenders for an amortisation schedule and a full cost breakdown.

For a walkthrough of refinance options for professional firms, see our dedicated guide on /refinance-loans.

How UK Business Loans can help

We’re an introducer that connects professional service firms with brokers and lenders experienced in refinancing for accountants, solicitors and related practices. Our role:

• Collect a short enquiry (no obligation) and run a free eligibility check.
• Match you with lenders/brokers who understand your sector and typical fee cycles.
• Help you compare quotes, terms and likely security requirements.

Ready to see what you could qualify for? Get a Free Eligibility Check — Start Your Enquiry.

Practical next steps & checklist before you apply

Gather these documents to speed the process:

• Latest full-year statutory accounts (and interim accounts if available).
• Recent management accounts (last 3–6 months).
• Business bank statements (3–6 months).
• Aged debtors/creditors, details of major clients and retainer agreements.
• Details of existing loans, balances and any early repayment charges.

Quick tips: check for early repayment penalties on current facilities, prepare a 12‑month cashflow forecast highlighting payroll dates, and be ready to explain any historic arrears or unusual cash events.

FAQs

Can I refinance if I have late payments on my business account?

Possibly. Lenders consider overall affordability and the reasons for late payments. You may still qualify through specialist lenders or brokers but expect higher scrutiny and possibly higher rates.

Will refinancing affect my company’s credit profile?

Refinancing itself is neutral; new credit checks may be recorded. Successfully repaying or consolidating debts can improve long-term creditworthiness, while multiple recent enquiries can be seen negatively.

Can I refinance to cover PAYE and VAT bills?

Some lenders will provide working capital for tax liabilities, but this should be a short-term plan. Consider whether the debt is being used to fund operations or recurring shortfalls — explore invoice finance as an alternative.

What security might lenders ask for?

Common security includes charges against commercial property, personal guarantees, debentures over company assets, or specific asset charges. Unsecured options exist but usually for smaller amounts and at higher cost.

How long does a refinance typically take?

Timescales vary: unsecured or simple consolidations can be a few days–2 weeks; commercial mortgage refis or complex secured deals commonly take 4–8+ weeks.

Is UK Business Loans a lender or regulated adviser?

No. We introduce businesses to lenders and brokers. We do not lend and we do not provide regulated financial advice — lenders/brokers you’re matched with will carry out suitability checks.

Final summary & call to action

Refinancing can be a practical and effective tool for accountants, solicitors and other professional firms to manage fee-cycle timing and meet payroll commitments — when used as part of a considered finance plan. It’s essential to weigh monthly savings against total cost, security and covenants. If you want independent quotes and a free eligibility check, we can introduce you to the lenders and brokers best placed to help.

Get started: Get Quote Now — Free Eligibility Check (quick, secure and no obligation).

About the author

UK Business Loans — Matching professional service firms with specialist lenders and brokers. Experienced editorial review by business finance specialists with extensive exposure to refinance and working capital solutions. Learn more on our About and How it works pages.