Should you refactor existing code that is not broken in a project focused on new features?

Question

Given a small project that aims to add new functionality to application, the changes introduced touch some existing code, involving updating these in certain areas. During implementation, I've found some of these code which were updated have candidates for refactoring.

Is this an appropriate time to refactor which in turn would require regression testing for those components affected (thus possibly introducing scope not originally part of the project)? Or should I defer, complete the functionality and perhaps have a separate project for refactoring (although I'm a bit hesitant as business users might not fully sponsor a project that does not add any functionality, unless they value code maintainability...)?