Best Business Loans

Can I include HVAC, electrical, plumbing, and compliance upgrades in the funding?

The short answer and what counts as eligible works

Yes—many UK lenders and brokers can include HVAC, electrical, plumbing, and compliance upgrades within business funding, especially under fit-out, refurbishment, asset finance, and broader commercial loan facilities. Eligibility depends on your business profile, the nature of the works, documentation, and the lender’s appetite. Packaging your project correctly often makes the difference between a fast approval and a decline.

In lender terms, these items sit within “M&E” (mechanical and electrical) and compliance works. That typically covers HVAC plant and controls, rewiring and distribution boards, plumbing and hot water systems, and mandated upgrades for fire safety, accessibility, and health and safety compliance.

Typical eligible inclusions can cover: HVAC units, ductwork, heat pumps, chillers, BMS controls, and thermostats; electrical rewiring to BS 7671, distribution boards, switchgear, emergency lighting to BS 5266, and LED lighting; plumbing upgrades, sanitary ware, pipework, water heaters, and grease management systems; and compliance items such as fire alarms to BS 5839, fire doors, signage, accessibility ramps, hearing loops, ventilation improvements, and gas safety remediation. Many providers will also consider extraction, ventilation, and air quality upgrades.

Common exclusions include routine maintenance, like servicing or filter changes, and purely reactive repairs with no capital improvement. Penalties, fines, or past-due rates are not financeable under standard business facilities. Structural property works may require a different form of property-secured finance rather than a trading business loan.

How lenders view “hard” and “soft” costs

Lenders often separate tangible “hard” costs from “soft” costs. Hard costs usually include equipment, materials, installation labour, and permanent fixtures. Soft costs can include design, professional fees, surveys, building control fees, and project management.

Many fit-out facilities will fund hard costs in full and soft costs in part, provided these are essential to delivering a usable, compliant space. Evidence like itemised quotes and contracts strengthens the case. Always check whether VAT is included, and if a VAT-only facility is needed.

Funding routes that can include M&E and compliance costs

Fit-out and refurbishment finance

Fit-out finance is often the most natural route for leasehold or freehold improvements that include HVAC, electrical, plumbing, and compliance works. Facilities can be structured with stage payments to contractors, or a single drawdown reimbursing paid invoices. Terms commonly range from 12 to 60 months.

Security can be unsecured, supported by a director’s guarantee, or secured against assets depending on size and risk. Landlord consent and a clear scope of works are typically required for leasehold projects. Where relevant, lenders may request planning or building control approvals before releasing funds.

Asset finance for identifiable plant and equipment

Where HVAC equipment is identifiable and durable—such as rooftop units, heat pumps, chillers, or packaged AHUs—asset finance via hire purchase or leasing can apply. This route can sit alongside a separate facility for electrical and plumbing works if the project is blended.

Asset finance can help spread the cost of large-ticket items and may offer ownership options at term end (hire purchase) or rental flexibility (finance lease). Lenders usually fund VAT on hire purchase at the outset, with VAT reclaimable per HMRC rules.

Unsecured business loans and cash flow facilities

For smaller or urgent compliance upgrades, unsecured business loans can be quick and flexible. Funds are paid into your account and can be used across multiple trades and suppliers. These are often suited to sub-£100k projects with straightforward scopes.

Costs and terms depend on trading history, affordability, and credit profile. Personal guarantees are common, and lenders may request management accounts to validate recent performance.

Sustainability and energy-efficiency finance

Many providers support energy-saving upgrades like heat pumps, high-efficiency boilers, LED relighting, destratification fans, insulation, and smart BMS controls. Demonstrating projected energy savings can strengthen the business case and, in some cases, improve terms.

Sector-specific schemes may exist via local authorities or energy-focused lenders. Availability changes over time, so include energy data, EPC information, or energy audits to help your application.

Government-backed support and regional programmes

Eligible businesses may access government-backed facilities such as the British Business Bank’s Growth Guarantee Scheme through accredited lenders. This can help improve access to finance, subject to status and lender criteria. Availability, eligibility, and terms are set by participating lenders and can change.

Some regions and councils also run grant programmes for decarbonisation or high-street regeneration. Grants typically require match-funding and specific compliance evidence. Grants are not guaranteed and are subject to application windows and caps.

What lenders typically require and how to package your project

Documents checklist for M&E and compliance projects

To maximise eligibility and speed, prepare the following:

Itemised quotations on supplier letterhead, including labour, materials, model numbers, and commissioning details.
Drawings or layouts, if relevant, and a scope of works aligned to building regs and standards.
Evidence of planning or building control approval where needed, and RAMS or method statements.
Landlord consent for leasehold premises and clarification on dilapidations obligations.
12 months’ business bank statements, last filed accounts, and recent management accounts.
Proof of ID and address for key directors, plus business insurance details.

Scope, pricing, and contingencies

Present a clear, itemised scope with make and model of major equipment. Separate hard and soft costs, and specify VAT treatment. Include a contingency allowance—typically 10–15%—to cover unforeseen issues discovered during strip-out or commissioning.

Lenders may prefer stage drawdowns against milestones or certified invoices. Agree milestone definitions upfront, like delivery of plant, first fix, commissioning, and handover, to streamline drawdowns.

Owned vs leased premises: what changes for funding?

For freehold properties, lenders may consider the uplift value of permanent improvements and the overall business stability. For leased premises, providers often require landlord consent and lease length that reasonably exceeds the finance term.

Be mindful of dilapidations and reinstatement clauses, which can affect the residual value of funded items. Clarify who owns the installed assets and how they will be treated at lease end.

Timelines and drawdown expectations

Unsecured business loans: Decisions in 24–72 hours, with funds shortly after approval.
Fit-out finance: 5–15 working days from complete application to first drawdown, depending on complexity.
Asset finance: 3–7 working days for standard HVAC plant, subject to supplier invoices and delivery.

Compliance, regulations, and practical boundaries

Funding does not remove your duty to comply with UK regulations, and lenders may request proof of compliance. Using qualified contractors and retaining certification reduces risk for you and your finance provider. Include compliance evidence in your funding pack where possible.

Electrical: BS 7671 (IET Wiring Regulations) certificates for rewiring and new circuits.
Gas: Gas Safe compliance for installations, testing, and commissioning of gas appliances.
Cooling: F-Gas certification for refrigerants and handling of HVAC systems.
Fire safety: BS 5839 for fire detection and alarms; fire doors installed to manufacturer specification.
Emergency lighting: BS 5266 design, installation, and test certificates.
Water hygiene: Legionella risk management and compliance with Water Supply (Water Fittings) Regulations.
Accessibility: Equality Act considerations for reasonable adjustments (ramps, signage, hearing loops).
Building Control: Approvals and completion notices for notifiable works.

VAT, capitalisation, and accounting treatment

VAT treatment varies by funding type. Hire purchase often funds VAT upfront, while leases spread VAT across rentals. Some lenders can offer VAT-only loans to bridge reclaim cycles.

Many M&E and compliance upgrades are capitalised as leasehold improvements or plant and machinery. Depreciation, capital allowances, and super-deduction style incentives evolve, so confirm treatment with your accountant.

Common pitfalls to avoid

Mixing maintenance with capital improvements without clarity—separate reactive repairs from capex upgrades.
Using unapproved contractors with no certs—choose accredited installers to satisfy compliance and lender checks.
Missing consents—secure landlord approvals and building control before committing to timelines.
Scope creep—agree contingency and change-control rules, so funding can adapt without delays.
Ignoring insurance—check warranties, workmanship guarantees, and business interruption cover during works.

Sector examples: how funding applies in practice

Restaurants and food production often finance extraction canopies, make-up air, gas interlocks, grease traps, and compliant flooring. Retail and leisure businesses commonly fund LED relighting, emergency lighting, air conditioning, and fire alarm upgrades during refurbishments.

Care homes and healthcare providers frequently include nurse call systems, fire compartmentation, accessible bathrooms, and water hygiene improvements. Manufacturing sites might finance dust and fume extraction, three-phase upgrades, and compliant switchgear and controls.

If you plan a full refurbishment, explore our fit-out finance guidance to see how structured facilities can bundle M&E and compliance works.

Next steps, FAQs, and how Best Business Loans can help

Best Business Loans is an independent introducer that helps established UK businesses find suitable funding providers for projects like HVAC, electrical, plumbing, and compliance upgrades. We do not lend money directly, and we don’t offer financial advice. Our role is to match your needs with lenders or brokers who may be able to help, so you can compare and choose with confidence.

Getting started is simple. Complete a Quick Quote, outline your project, upload any available quotes, and our AI-led system will match you with relevant providers. There is no obligation to proceed, and you remain in control throughout.

FAQs

Can I include labour and installation as well as equipment? Yes—fit-out and refurbishment facilities commonly include labour, first fix, and commissioning, subject to itemised quotes.

Will lenders fund soft costs like design and compliance surveys? Sometimes, if they are essential to the project; include them clearly as separate line items.

Do I need landlord consent for leasehold premises? Usually yes, and lenders often require written consent before releasing funds for intrusive works.

Can VAT be funded? Depending on the product, VAT may be funded upfront or via a VAT-only facility; speak to the provider and your accountant.

How fast can I get funding? Unsecured loans can complete in 24–72 hours; fit-out and asset finance typically take 3–15 working days once your documents are ready.

Key takeaways

HVAC, electrical, plumbing, and compliance upgrades can often be financed under fit-out, asset, or unsecured facilities.
Clear scopes, itemised quotes, and compliance evidence improve approval odds and speed.
Stage payments, VAT handling, and contingencies should be agreed upfront.
Use qualified contractors and retain certification to satisfy both regulators and lenders.
Our AI-led matching introduces you to suitable providers—fast, transparent, and with no obligation.

Ready to explore your options? Submit a Quick Quote for a no-obligation eligibility check and introductions to relevant providers. Best Business Loans operates as an independent introducer; eligibility, rates, and terms are set by providers and subject to status and affordability.

Regulatory note: We aim to ensure our information is fair, clear, and not misleading. This content is for general information only and is not advice. Updated October 2025.