Calculate your chattel mortgage repayments and see the tax benefits. Includes GST input credit, depreciation deductions, and interest deductibility estimates for your business.
| Frequency | Repayment | Total interest | Total cost |
|---|---|---|---|
| Weekly | $225.37 | $8,595 | $58,595 |
| Fortnightly | $450.97 | $8,626 | $58,626 |
| Monthly(selected) | $978.31 | $8,698 | $58,698 |
Under a chattel mortgage, you own the asset from day one. This means you can claim GST upfront, depreciate the asset, and deduct interest. Here is the estimated breakdown.
| Tax benefit | Annual | Over loan term (5yr) |
|---|---|---|
| GST input credit | Claimed upfront | $4,545 |
| Depreciation deduction | $1,420 | $7,102 |
| Interest deduction | $435 | $2,175 |
| Est. total tax benefit | $13,822 | |
| Est. net cost after tax | $44,876 |
Tax benefit estimates are indicative only and based on simplified assumptions (straight-line depreciation, uniform interest distribution). Actual tax outcomes depend on your individual circumstances, business structure, and other factors. Consult your accountant or tax adviser for advice specific to your situation.
Switching from monthly to weekly repayments could save you $103 in interest over the life of this finance.
The tax benefit panel shows how GST credits, depreciation, and interest deductions combine to reduce the effective cost of the asset. For a GST-registered business, the total tax benefit can be substantial.
Switch the GST toggle to see the difference. GST-registered businesses claim the GST credit upfront (purchase price divided by 11), which reduces the depreciable amount but provides an immediate cash flow benefit.
A higher balloon reduces your regular repayments but increases the total interest cost and creates a lump sum obligation at the end. Use the input to see the trade-off.
Base rate entities (turnover under $50M) pay 25% company tax. Non-base rate entities pay 30%. The higher rate increases the value of every deduction. Switch between them to see the impact on net cost.
Most lenders want to see at least 12-24 months of trading history. Newer businesses may need to provide additional financials or a larger deposit.
Lenders review your business financials (profit and loss, balance sheet, or recent tax returns) to assess serviceability. Healthy cash flow is the key indicator.
The type, age, and condition of the asset affect the rate and terms. New vehicles and well-known brands attract better rates. Most lenders have maximum age limits (e.g. no more than 12-15 years old at the end of the loan term).
Your personal and business credit history influences the rate. A clean credit file opens access to the most competitive rates. Some non-bank lenders can work with less-than-perfect credit.
Compare chattel mortgage finance from 50+ lenders. Find a rate and structure that works for your business.
Subject to lender approval, terms and conditions apply.
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A chattel mortgage is a business finance structure where the borrower takes ownership of the asset from day one. The lender has a charge (mortgage) over the asset as security until the loan is repaid. It is one of the most popular structures for financing business vehicles and equipment in Australia.
Because you own the asset from day one under a chattel mortgage, you can claim depreciation on it as a tax deduction. The depreciable amount is the purchase price excluding GST (if you are GST registered). The ATO effective life for motor vehicles is 8 years. You can choose between the diminishing value method or the prime cost (straight-line) method. This calculator uses the simplified straight-line method for estimates.
There are three main tax benefits. First, if your business is GST registered, you can claim the GST input credit upfront on the full purchase price. Second, you can claim depreciation deductions on the asset over its effective life. Third, the interest on the finance is fully tax deductible because you own the asset from day one. These benefits can significantly reduce the effective cost of the asset.
The main difference is ownership timing and GST treatment. With a chattel mortgage, you own the asset from day one and can claim the GST credit upfront. With hire purchase, the lender owns the asset until you make the final payment, and GST is claimed on each instalment rather than upfront. Interest is also treated differently: chattel mortgage interest is deductible throughout, while hire purchase interest is not deductible until ownership transfers.
No. Any business can use a chattel mortgage structure. However, GST registration unlocks the upfront GST input credit (purchase price divided by 11), which is a significant benefit. Non-registered businesses can still claim depreciation and interest deductions.
Yes. A balloon (also called a residual value) reduces your regular repayments by deferring part of the principal to a lump sum due at the end of the loan term. Common residual values for vehicle chattel mortgages are 20-30%. The trade-off is higher total interest and an obligation to pay (or refinance) the balloon at the end of the term.
The ATO sets the effective life for motor vehicles at 8 years. This applies to cars, utes, vans, and light commercial vehicles. Heavy vehicles and specialist equipment may have different effective lives. The effective life determines how quickly you can claim depreciation deductions. This calculator defaults to 8 years but allows you to adjust for other asset types.
Results are estimates only and should not be relied upon for financial decisions. Actual chattel mortgage repayments will depend on the lender, your credit profile, and the specific terms offered. Interest rates used are for illustration purposes only and may not reflect current market rates.
Subject to lender approval, terms and conditions apply.
This calculator is general information only and is not financial advice.