Equipment Finance

Chattel Mortgage

This type of facility (sometimes also known as an Equipment Loan or Commercial Loan) is generally secured by the equipment being purchased with the interest component of the facility being fixed for the entire term of the finance contract.

This type of facility may be structured with or without a final balloon payment and seasonal finance structures with alternate payment amounts and dates may also be considered. Equity in the form of deposits and/or trade-ins are permissible and can assist in reducing loan repayments.

Subject to confirmation from your external accountant, borrowers may be entitled to full recovery of the GST component of the purchase price of the goods in your BAS return following the purchase of the equipment or vehicle.

Additionally, the interest portion of the finance repayments as well as the Depreciation component of the equipment or vehicle may also be tax deductible.

Commercial Hire Purchase (CHP) / Asset Purchase

(It is recommended that you seek advice from your external accountant regarding this product as it may have tax implications for borrowers using cash based accounting or accrual accounting methods).

This product is similar to the Chattel Mortgage product however, ownership of the goods rests with the financier until the last payment is made and cleared. The facility is also generally secured by the equipment being purchased with the interest component of the facility being fixed for the entire term of the finance contract.

This facility may also be structured with or without a final balloon payment and seasonal finance structures with alternate payment amounts and dates may also be considered. Equity in the form of deposits and/or trade-ins are permissible and can assist in reducing loan repayments.

Additionally and subject to confirmation from your external accountant, borrowers may be entitled to full recovery of the GST component of the purchase price of the goods as well as the GST component in the finance contract in your BAS return following the purchase of the equipment or vehicle and settlement of your contract.

Additionally, the interest portion of the finance repayments as well as the Depreciation component of the equipment or vehicle may also be tax deductible.

Finance Lease (Leasing)

This facility requires 100% financing of the equipment or vehicle being purchased and no equity in the form of deposits or trade-ins is permitted.

The rental instalments paid during the year are normally fully tax deductible (subject the structure being acceptable to the Australian Taxation Office) and the GST component of the rentals can be included in your BAS return.

The facility must have a residual payment at the end of the agreement and the amount of this figure is calculated based on Australian Taxation Office guidelines.

Rental instalments are fixed for the duration of the lease and structured rental instalment may be considered subject to strict Australian Taxation Office and financier guidelines.

It should be noted that the GST component contained within the purchase price of the vehicle or piece of equipment is claimed by the financier and that this amount varies in vehicles that are sold with a luxury motor vehicle tax component.

Operating Lease

This product can provide Fleet Operators with a simple solution, saving both time and resources.

By using this product a business can save the cost of upfront capital outlays by establishing a simple monthly instalment plan that incorporates the expense of the vehicle acquisition, registration, maintenance and in some cases comprehensive insurance.

The tracking of maintenance and fuel consumption can be managed by the provider and the risk of loss on sale may be reduced.