Payroll is the one bill that cannot be late. This guide walks through why a healthy business can still come up short on payday and how to size a request to that shortfall.
Apply Now →Employees are paid on a schedule: weekly, every other week or twice a month. Revenue arrives on customers’ schedules, which are rarely the same. A business with full order books can stand at a Friday with $20,000 in payroll due and $9,000 in the account, because the invoices that will cover it are still in 30-day terms.
That is not a failure of the business model. It is a mismatch of calendars, and it is most common in firms that are growing, because each new hire adds to the weekly outflow before the work they do produces cash.
Between steps two and four, the business has paid for the labor but not yet received revenue for it. A crew paid weekly on net-30 invoices is financing about five payrolls at any given time.
Texas employers also report wages and pay unemployment tax quarterly. The Texas Workforce Commission requires the quarterly wage report and taxes by the last day of the month after the quarter ends, so a quarter that ends in June has a July 31 due date. That is a predictable cash outflow on top of regular payroll, and a business that did not set money aside for it will feel it.
Texas does not require most private employers to carry workers’ compensation, but those who choose to will have premium payments to plan for as well.
For illustration only, not our terms: a landscaping company with eight employees pays $16,000 a week. It wins a new commercial contract starting in April and adds three workers, raising weekly payroll to $22,000. The client pays 30 days after invoice, and invoices go out at month-end. The first payment arrives in about 60 days. During that time the company pays about eight weeks of the added $6,000, or around $48,000, from its own account.
A request sized around $48,000, plus a cushion for taxes, matches the gap. A request sized to the whole contract does not.
Payroll funding is for a timing gap that you can see closing. It is a poor fit for a business whose costs have permanently outrun revenue, since a funding request cannot change that. If the answer to “when does the money come back” is a specific invoice or season, the request fits.
Texas Biz Funding looks at requests from $25,000 to $5,000,000, funded in as little as 24 hours once approved. Sole proprietors can apply, and the five-minute application uses a soft credit pull.
Quarterly wage reports and taxes are due by the last day of the month after the quarter ends.
Each new hire adds weekly cost before the revenue from their work arrives.
Add up the payrolls you must fund before the invoices you are waiting on will be paid, then include employer taxes. Avoid padding it with unrelated costs.
Yes. Sole proprietors can apply.
It uses a soft credit pull, so no.
Three months of business bank statements and a 5-minute application. FICO 500+ considered. $25,000 to $5,000,000, funded in as little as 24 hours.
Apply Now →It takes about two minutes and it will not affect your credit score.
No obligation • No impact to your credit score
