Pub finance: funding a purchase, refit or tenancy

Pub finance is the funding a business uses to buy a pub, improve it or take over the running of one. It is not a single product: it is a set of business finance options matched to what the money is for.

A pub is part property, part licensed trade and part equipment, so one deal often needs more than one kind of funding. The property can be financed against the building, the kitchen and cellar kit against the assets, and trading needs against the business’s cash flow.

The main routes are a commercial mortgage for the building, asset finance for equipment and short-term finance for gaps. Each is repaid in a different way, and all of them are subject to status and the lender’s criteria.

On our site, lender-panel figures for asset and property finance run up to £2m and term loans £25k–£500k over 3–60 months. Those are ranges across lenders, not offers, and nothing here is a quote.

Yes, because the structure decides what you own, what you can borrow against and what you must buy from your landlord. Funding for a freehold purchase looks very different from funding for a tenancy.

Loans secured on commercial premises are generally not regulated mortgage contracts, according to the FCA’s Perimeter Guidance, because the property is not used as a dwelling. A pub with a flat above is a mixed-use case, and the FCA says mixed-use loans can be covered if the occupier uses at least 40% of the land as or in connection with a dwelling, so get the structure checked. Our guide to semi-commercial mortgages covers mixed-use property.

A pub that sells alcohol permanently needs a premises licence, and the person running it needs a personal licence to act as designated premises supervisor. GOV.UK says anyone selling or supplying alcohol in England and Wales needs a licence or authorisation, usually from the local council.

• Premises licence: authorises the premises for licensable activities. GOV.UK lists a transfer application for when a licence changes hands.
• Designated premises supervisor: premises licensed to sell alcohol must have one, and they hold a personal licence.
• Fees: GOV.UK says premises licence fees vary with the property’s rateable value band.

Lenders assess the business, the property and the people behind it, case by case. What they ask for varies, and there is no standard formula and no certain outcome.

• Trading history, or for a first pub a business plan and cash flow forecast showing how repayments will be met. See our guide to a business plan a lender will read.
• Your own experience of running a licensed venue, and the deposit you can put in.
• A valuation of the property and the loan to value, as explained in our guide to loan to value.
• Your credit history. A lender may also ask a director for a personal guarantee.

Credit history matters, but it is one factor among several. Our guide to business loans with bad credit explains how a lender may weigh a weaker file.

Stamp Duty Land Tax, business rates, licensing and, for a pub you will let, energy efficiency work all come on top of the price. Budget for them before you borrow, because they are paid in addition to the loan, not instead of it.

• Stamp Duty Land Tax: HMRC says an SDLT return and payment is due within 14 days of completion in England and Northern Ireland. Scotland and Wales use their own taxes. See stamp duty on commercial property.
• Business rates: GOV.UK lists pubs among the properties charged business rates. Your council sends the bill each February or March for the following year. See business rates explained.
• Energy efficiency: landlords of privately rented non-domestic property in England and Wales must have at least an EPC E rating, so it matters if you buy a pub to let.

Capzy does not give tax advice, so ask an accountant to check how SDLT and rates apply to your purchase.

In England, eligible pubs receive a 15% reduction on their business rates bills for 2026/27. The government announced on 27 January 2026 that eligible pubs and live music venues would receive it, and that their bills would be frozen in real terms in 2027/28 and 2028/29.

It is awarded by your local council, which decides each case with regard to the government’s guidance. A pub for these purposes is open to the general public, allows free entry other than for occasional entertainment, allows drinking without food and permits drinks to be bought at a bar. Restaurants, hotels and nightclubs are not included. As of October 2026, check with your council whether your pub qualifies. Scotland, Wales and Northern Ireland handle business rates differently.

Equipment for a refit is most often funded with asset finance, where the equipment itself is the asset behind the deal. The two common forms are hire purchase and leasing.

With hire purchase, the British Business Bank says the business buys an asset from the lender over a set period, paying a deposit and then fixed payments, and ends up owning it or having the option to buy it. Leasing lets a business use the asset in exchange for rental payments. The principal difference is who owns the asset. Our guide to equipment finance explains the choice.

Building work, such as extending a kitchen, is a different job and may need a term loan or extra borrowing against the property. Whichever you choose, check the total repayable, not only the monthly figure.

The Pubs Code regulates the relationship between pub companies that own 500 or more tied pubs in England and Wales and their tied tenants. The Pubs Code Adjudicator enforces it.

The Adjudicator says that a tied tenant can ask for a Market Rent Only option on four events: receiving a rent assessment proposal, renewal of the agreement, a significant increase in the price of a tied product or a defined trigger event. Under it, the tenant buys products on the open market and pays a market rent. The Code also requires a rent assessment at least every 5 years.

Capzy is a credit broker, not a lender, and is paid by the lender. We introduce hospitality businesses to lenders that offer the kinds of finance above, and set out what comes back so you can compare it. See our hospitality finance page for more.

You can check your funding options with a soft search that does not affect your credit score. A full application to a lender may involve a hard search, and any offer is subject to status and lender criteria. Compare providers in our lender directory. We do not arrange licences, give legal advice or give tax advice.