Insights · Finance ·
Finance for equipment, utes and trucks
How you pay for equipment changes your cash flow, GST and tax. Here is a plain comparison of the common options.
The common options
- Chattel mortgage: you own the asset from day one and the lender takes security. If registered for GST, you can generally claim the GST on the purchase price in the BAS period of purchase (cash or accrual rules apply). Interest and depreciation may be deductible.
- Hire purchase: the financier owns it until the final payment. For GST, a hire purchase is generally treated similarly to a sale up front if interest is separately disclosed.
- Finance lease: the financier owns it; you claim lease payments (and GST on each payment) and may have a residual.
- Cash: no interest, but it ties up working capital you may need for jobs.
Questions to ask
- What does it do to my 13-week cash flow forecast?
- How does it affect QBCC current ratio and NTA?
- What depreciation or Instant asset write-off 2026–27 applies?
- What is the total cost including fees and the balloon?
Lending is arranged through a licensed credit provider. PRM does not provide credit assistance. See also vehicle leasing and buying a car through your business.
Want this looked at for your business?
Book a free 15-minute Financial Health Check with Tereza, our practice manager. We look at income, tax, the business, mortgage, insurance and super in one go. Short on time? Grab a 5-minute quick chat.
Sources
- ATO: Motor vehicle and equipment finance (GST and hire purchase)
- ATO: Small business entity concessions
Related
General information only. This doesn’t take your circumstances into account and isn’t tax, financial or legal advice. Talk to your accountant or registered tax agent before acting. PRM is not a registered tax agent; tax agent services are provided by Australian Tax & Super Pty Ltd (TPB 25291395).