Short answer — Yes, but it depends

Combining a VAT loan with a revolving credit facility is commonly possible for incorporated legal practices (e.g., LLPs, limited companies). Lenders will consider:

• Security — whether both products use the same assets (debenture, property) or are ring‑fenced;
• Lender appetite — some lenders specialise in professional services and are comfortable with multi-product structures;
• Covenants and intercreditor arrangements — how repayment priority and enforcement would work;
• Regulatory constraints — SRA client money rules and safe handling of client funds.

Want a quick, no‑obligation assessment? Free Eligibility Check.

How solicitors combine finance products (what lenders typically allow)

Typical product pairings

• VAT loan + Revolving credit: VAT loan covers a specific HMRC liability; revolving credit provides flexible working capital.
• Invoice finance + Revolving credit: Invoice finance unlocks approved invoices, while a separate facility smooths day-to-day cashflow.
• Bridging + Asset finance: Used for short-term property timing gaps plus equipment or vehicle finance.

Mechanics — structure and security

Lenders structure combined facilities in one of several ways:

• Separate facilities with distinct purposes and limited cross-use clauses (e.g., VAT loan proceeds earmarked for HMRC only).
• Multiple facilities under a single security package (debenture) — this usually requires clear intercreditor terms to define enforcement priority.
• Tiered security where a senior lender has priority and second-charge lenders accept subordinated positions.

Because structures vary, firms should ask lenders/brokers to explain intercreditor solutions and provide worked examples. For tailored introductions to lenders who understand solicitors finance, start a Free Eligibility Check.

Why law firms combine a VAT loan with revolving credit

• Dedicated VAT cover: A VAT loan earmarks funds to meet HMRC deadlines and reduces ad hoc overdraft usage.
• Flexible working capital: Revolving credit (RCF) provides on-demand cash for payroll, rent, supplier bills and disbursements.
• Improved cost control: Short-term VAT borrowing can be cheaper and more predictable than repeated overdraft spikes.
• Operational clarity: Keeping VAT and working capital separate preserves invoice finance capacity for matters that need it.

To see lenders who commonly support combined structures for firms with borrowing needs from £10,000 upwards, try a Get Quote Now.

Risks & compliance — what solicitors must check

SRA and professional conduct

Solicitors must ensure that borrowing does not conflict with SRA client money rules. Facilities must not be used in ways that could compromise client funds or mislead clients about the firm’s financial position. Disclose intended uses to lenders and ensure trust accounts remain compliant.

Security & cross-default

If multiple products are secured by the same assets (company property, debentures, personal guarantees), a default on one product can trigger cross-defaults across all facilities. Understand enforcement scenarios and consider limiting shared security where possible.

Covenants & affordability

Lenders may impose covenants (minimum cash balances, maximum leverage, debtor days). Model realistic cashflows and test covenant sensitivity to matter delays or slower settlements.

Cost transparency

Make sure representative examples, fees and interest calculations are laid out clearly by the lender or broker. UK Business Loans introduces firms to lenders and brokers — you will receive full cost information from the lender before you proceed.

Not sure how this affects your firm? Speak to an experienced broker via our Free Eligibility Check.

Typical lender information & documents when combining products

To assess a combined request lenders commonly ask for:

• Company structure (Ltd, LLP) and ownership details;
• Bank statements (last 3–12 months) and recent management accounts;
• VAT returns and VAT liabilities schedule;
• Details of client money handling, trust account structure and SRA compliance policies;
• Schedule of existing facilities and liabilities, plus any outstanding guarantees;
• Matter-level cashflow forecasts and expected settlement timetables.

Tip: prepare a clear, matter-level cashflow showing expected receipts and VAT due dates — this helps lenders price and size the facilities correctly.

Example scenarios — how firms commonly combine products

Case 1: VAT loan + Revolving credit

A conveyancing-focused mid-size firm faces seasonal VAT peaks. It takes a short-term VAT loan to cover the HMRC liability and secures a modest revolving credit facility for payroll and disbursements. The VAT loan is ring‑fenced for HMRC payments; the RCF is used for daily liquidity. The lender takes a debenture and limited covenants; the broker negotiates lower interest on the VAT loan due to predictable short-term use.

Case 2: Invoice finance + Bridging

A litigation practice with long settlement timelines uses invoice finance to unlock approved invoices and a short-term bridge to cover an unexpected lease deposit. The invoice facility is advance-only against assessed invoices; the bridge has a short term and specific exit plan tied to invoice settlements.

How to choose the right finance partner for solicitors

When picking lenders or brokers look for:

• Sector experience — lenders who regularly work with legal practices;
• Transparency — clear pricing, fees and worked examples;
• Structure capability — experience with intercreditor agreements and multi-product solutions;
• Speed and communication — quick turnaround on eligibility checks and clear next steps.

UK Business Loans can match your firm to brokers/lenders who specialise in solicitor finance — start a Free Eligibility Check to be matched quickly.

For more sector-specific guidance see our related resource on solicitors business loans.

Step-by-step — how UK Business Loans helps

1. Complete our short enquiry form (takes around 2 minutes) — Get Started — Free Eligibility Check.
2. We match your firm with lenders and brokers experienced in legal practice finance and multi-product structures.
3. Receive rapid responses — often within hours — with indicative terms and next steps.
4. Compare offers, ask questions, and proceed with the provider you choose. Submitting an enquiry is not an application and does not commit you to borrowing.

We help firms seeking facilities from £10,000 upwards. Complete the form now to be introduced to suitable partners: Get Quote Now.

Frequently asked questions

Can a VAT loan be used for anything other than VAT?

Most VAT loans are specifically intended to meet HMRC liabilities. Using VAT loan proceeds for other purposes may breach lender terms — always read the facility terms carefully.

Will combining loans hurt our credit rating?

Submitting an enquiry via UK Business Loans does not affect your credit score. If you proceed with an application, lenders or brokers may carry out credit checks — ask whether they are soft or hard checks before consenting.

Are personal guarantees common?

Smaller or newer firms may be asked for personal guarantees, particularly where directors own property or for unsecured facilities. Consider legal advice before accepting guarantees.

How quickly can we get funds?

Decision times vary by product and lender, but many partners can provide indicative offers within 24–72 hours once documentation is supplied.

If you still have questions, begin with a no‑obligation enquiry: Free Eligibility Check.

Ready to combine finance the right way?

If your firm needs VAT cover and flexible working capital, complete our simple enquiry to be matched with lenders and brokers who understand solicitors finance. It’s free, fast and no obligation: Get Started — Free Eligibility Check.

UK Business Loans is an introducer and not a lender or independent financial adviser. We connect legal practices with lenders and brokers so they can receive quotes and terms. Submitting an enquiry is not an application and does not affect your credit rating. All finance products carry risk — read lender terms and consider regulated advice where appropriate. Your information is used to match you with suitable finance partners and is handled securely and confidentially.