Equestrian finance for livery yards, riding schools and horse businesses

It depends on the horsebox's maximum authorised mass and when you passed your car test, and it should be settled before you choose the vehicle to finance. A car licence passed on or after 1 January 1997 covers a horsebox up to 3,500kg, which usually limits the box to two horses once it is loaded with horses, tack and water. Anything between 3,500kg and 7,500kg needs category C1, which drivers who passed their car test before 1997 usually already hold and later drivers must add with a medical and a test. Above 7,500kg you need category C. Lenders fund all three classes, but a yard that buys a 7.5 tonne box for staff who only hold a post 1997 car licence has bought something it cannot use, so we confirm who will drive before we arrange horsebox finance and match the agreement to the weight class.

Does a horsebox used for business need an operator's licence?

Usually, once it is over 3.5 tonnes. A horsebox counts as a goods vehicle when it is used in connection with a business, so a dealer, a competition yard taking clients' horses, a livery yard offering transport or a professional rider paid to compete generally needs a goods vehicle operator's licence for it. A restricted licence covers carrying your own horses for your own business, while a standard licence is needed to carry other people's horses for payment. Purely private use to take your own horse to a show does not need one. The licence application asks for proof of financial standing and a suitable operating centre, and the box must pass its annual test.

• Pre 1997 C1 at 70. C1 entitlement is not renewed automatically at 70, and the driver must pass a medical to keep it.
• Plated weight. The weight on the plate decides the licence, not the empty weight, so check the plate before agreeing the price.
• Lender checks. Lenders ask whether the box is for business or private use, because private horseboxes for individuals are consumer finance with different rules.
• Northern Ireland. Licence categories are the same, but driving licences and operator licensing are run by DVA and the Department for Infrastructure.

GOV.UK lists the driving licence categories and their weight limits. Our horsebox finance page covers the vehicles, haulage and HGV finance explains operator licensing for larger lorries, and asset refinancing covers raising money against a box the business already owns. Instant Quotes finds panel lenders for business horseboxes, credit search free.

A riding school does, a yard that only offers livery generally does not. In England, any business that hires out horses for riding or gives riding instruction on its own horses needs a hiring out horses licence from the local council under the 2018 animal activities licensing rules, and the licence runs for one, two or three years depending on the council's assessment. In Wales and Scotland the Riding Establishments Acts still apply, and the council issues a licence that must be renewed every year. In all three nations the council's inspection is carried out by a vet registered with the Royal College of Veterinary Surgeons. A yard that only provides livery for owners who ride their own horses is not hiring out horses, so it falls outside these licences, though planning permission for commercial equestrian use still matters. We arrange finance for riding schools, livery yards and mixed yards, and the licence history is one of the first documents a lender reads.

Will a lender fund a riding school before the licence is granted?

Yes for some parts of the project, not all of it. A lender can fund an arena, stables or a horsebox for a new riding school because those assets have value whatever happens to the business, but working capital and lending against forecast lesson income usually wait until the licence is granted, because the school cannot legally take bookings without it. A buyer taking over an established riding school should know that the licence does not simply pass with the sale, so the purchase is usually conditional on the new operator being licensed. In Wales and Scotland the council can grant a provisional licence for three months where it is not yet ready to issue a full one, and a second can follow, which gives a new school a route to open while the lender waits for the full licence.

• Star ratings. In England a higher rating usually means a longer licence, which reads well to a lender as evidence of good standards.
• Horses as assets. School horses can be financed, but lenders lend cautiously against them because their value falls with age and soundness.
• Insurance. Public liability and employer's liability cover are conditions of the licence and of any finance.
• Planning. A change from private to commercial use needs planning permission, and lenders check it before funding the buildings.

GOV.UK explains the hiring out horses licence in England and the riding establishment licence in Wales and Scotland. Our equestrian arena finance page covers arenas and stables, and equestrian finance covers buying a yard. Instant Quotes matches a riding school to panel lenders for arenas, stables and vehicles with no footprint on the owner's credit file.

Lenders read an equestrian business by its income streams, because each behaves differently:

• Livery. Monthly fees for DIY, part or full livery under livery agreements, usually with short notice periods. Reliable while stables are full, but a few departures in winter can turn a profit into a loss.
• Lessons and hacking. Riding schools and trekking centres earn from lessons, pony days and holiday courses, with clear peaks in school holidays and summer.
• Competitions and events. Entry fees and facility hire at centres with arenas, cross-country courses or indoor schools.
• Breeding and sales. Stud fees, foal and young horse sales, and producing horses for sale. Income can be large but irregular.
• Transport and services. Horse transport, farriery, saddlery, physiotherapy and dentistry, often sole traders with vans and specialist equipment.

Many equestrian properties are a house with land and stables. If borrowing would be secured on a house that you or a relative occupy, it is likely to be a regulated residential mortgage, which we do not arrange. Holiday lets on the yard are also outside our scope. We arrange finance for the business: equipment, vehicles, working capital, and loans or commercial mortgages secured on commercial yards, land and buildings that are separate from any dwelling. Where a property mixes a home and a business, we can discuss which parts of the need can be met through business borrowing and point you towards a regulated adviser for the rest.

Secured borrowing puts the yard or land at risk, and specialist property can mean larger deposits and higher costs. Repayments continue through quiet months and after the loss of key liveries. Business rates, which generally apply to commercial yards, and VAT, which treats grazing, stabling and different livery packages differently, should be checked with an accountant before borrowing, because they change what the yard can afford. Borrowing of £25,000 or less by sole traders and small partnerships can be regulated consumer credit, which brings additional protections. Alternatives include raising livery or lesson prices before investing, phasing arena or stable works, and hiring a horsebox for occasional use rather than buying. Farms adding horses as a new enterprise should also read our farm diversification finance page, and equine vets are covered under veterinary practice loans.