Asset finance for tradies covers four main types of asset: utes and vans, plant and equipment, trailers, and tools. Lenders see each one as a different level of risk. Each gets different loan structures, and each affects your BAS in ways that change the cost and timing of the deal.
The structure you pick (chattel mortgage, hire purchase or operating lease) decides who owns the asset during the loan, how GST goes through your BAS, and what you can claim at tax time. Sort that out before you sign anything.
Below we go through each asset type, how the quarterly BAS cycle should fit into your planning, and what a lender looks at differently for a sole trader and a company.
The four asset types tradies finance
Utes and vans
The dual-cab ute is the most common asset in tradie finance applications. Lenders see a new or near-new vehicle from a franchised dealer as low risk. It's easy to sell, it loses value at a predictable rate, and there are plenty of buyers if the lender ever has to take it back.
Most ute finance is a chattel mortgage. You own the ute from day one, the lender registers a security interest on the PPSR, and you repay principal and interest over three to five years. You claim the GST on the purchase price back in full on your next BAS, not bit by bit each month. On a $65,000 ute (plus GST), that's a $6,500 GST credit in your next quarterly BAS instead of being spread over 60 months. For what the most popular models cost per week on finance, see what five work utes cost to own.
Private sale vehicles and ex-fleet vehicles over seven to eight years old get a closer look from lenders. Some have strict age limits. Others will do the deal but charge a higher rate on older vehicles. If you can't decide between owning the vehicle and handing it back at the end, our chattel mortgage vs operating lease article explains the differences.
Plant and equipment
Lenders look at excavators, concrete pumps, scissor lifts and similar gear differently from vehicles. There are fewer buyers, resale values are harder to pin down, and the market for second-hand gear is smaller. A $90,000 general-purpose excavator is an easier deal than a $90,000 purpose-built spray rig. Plenty of people buy excavators. The spray rig needs a buyer in the same niche.
Specialised or heavily modified gear usually gets a lower LVR: 60 to 70% of the purchase price, compared with 80 to 100% on a standard ute. That's because the lender would find it harder to get its money back. For larger plant above about $250,000, full-doc is standard. Below that, good credit and two-plus years on your ABN can get you a low-doc deal with dedicated equipment finance lenders.
Trailers
Tradies often finance a trailer with their main vehicle. Lenders look at the trailer's age, type (enclosed, flatbed, tipper, plant trailer) and whether it's registered. A new trailer from an established maker settles quickly and easily. An older, unregistered trailer on its own will struggle to find a mainstream lender, because it's hard to prove what it's worth as security.
Trailer finance is usually at slightly higher rates than light commercial vehicles, because fewer people buy second-hand trailers. If you're buying a vehicle and trailer together, putting them in one application usually gets better terms than two separate deals.
Tools and workshop equipment
Hand tools and power tools are rarely financed on their own. If you defaulted, it would cost the lender more to recover them than they're worth, so mainstream lenders won't take single tools as security. Tradies paying for smaller tools usually use a line of credit or add the cost to a bigger vehicle or fit-out application.
Workshop equipment is different. Hoists, welders, compressors, CNC machinery and spray booths are treated as fixed-asset finance, judged on resale value and how much the business needs them. A hoist in a mechanical workshop or a press in a fabrication shop earns income and has a proven resale market, which is what asset finance lenders want to see.
How the BAS cycle affects your loan timing
Most tradies lodge BAS quarterly. The standard due dates for FY2025-26 are 28 October, 28 February, 28 April and 28 July. Two things about those dates affect equipment finance decisions directly.
GST timing
On a chattel mortgage, you claim the full GST on the purchase back on your next BAS, not monthly. Buy a $110,000 ute (including GST) before the 30 June cutoff and the $10,000 GST credit comes through on the July BAS. Buy the same ute on 10 July and the credit falls into the October quarter. Four months of cash makes a real difference to a smaller business.
BAS statements as proof of income
Low-doc lenders usually ask for two to four BAS statements in a row to prove your turnover. If you apply in the first few weeks of a new quarter, you may only have three full quarters to show, which gives a thinner picture of your income. Waiting until mid-quarter, or getting your accountant to prepare a year-to-date income statement, fills that gap.
The other date that matters this financial year: the $20,000 instant asset write-off applies per asset for businesses with aggregated turnover under $10 million, but only for assets first used or installed ready for use by 30 June 2026. Ordering and paying isn't enough. The asset must be working by that date. Under current law, the $20,000 threshold becomes permanent from FY2026-27, but the 30 June 2026 deadline applies to this year's return.
Sole trader vs company: what lenders look at differently
Sole trader
A lender treats a sole trader and their business as one. It looks at your personal credit, how long you've had your ABN, and your business income together. Personal debts like your mortgage, car loan and credit cards count directly against what you can afford to repay. The application is simpler, but you're personally on the hook for all of it.
Low-doc is usually easiest for sole traders who've had their ABN a while. Most specialist lenders will approve a chattel mortgage of up to $150,000 to $250,000 on an ABN with 12-plus months of trading, a signed income declaration and the supplier invoice. You don't need tax returns or full financials.
Company structure
With a company, the lender looks at the company's finances and then asks the director to personally guarantee the loan. The company has to show it can repay from its own trading income. Director drawings alone rarely get you over the line if the profit and loss says something different.
The upside is that a company with two years of filed financial statements and clean credit can borrow more. On deals under $500K, dedicated asset-finance lenders are often more comfortable with company borrowers than the major banks are, because the lenders writing this product include non-bank specialists who understand trading businesses.
Trusts
Discretionary trusts need the most paperwork: the trust deed, trustee details and beneficiary information. Smaller lenders often turn trust applications down. The specialist lenders a broker works with will look at them, but expect it to take longer and to need full-doc whatever the deal size.
What lenders look for across all structures
Lenders look at four things:
- Credit history: personal credit (for sole traders and directors) and the business credit file, through ASIC searches and the PPSR
- ABN age and GST registration: 12 months is the usual minimum for low-doc, and 24 months for easier full-doc approval
- The asset: its type, age, condition and how easy it is to sell
- Ability to repay: income shown through BAS statements, bank statements or full financials, depending on the lender and deal size
Current chattel mortgage rates for clean tradie applications are around 6.5 to 8.5% p.a. on standard assets with strong credit. Older vehicles, specialised plant and files with marks on the credit history pay more than that. Clean low-doc deals on standard assets settle in 1 to 3 business days from signed documents, sometimes on the same day. Full-doc applications on complex or unusual plant take 3 to 7 business days.
Structure and timing: get both right
The asset type, your business structure and the BAS calendar all affect each other. A company that buys a new ute on a chattel mortgage before 30 June claims the GST in the July BAS, takes the depreciation deduction in this year's return, and starts a fixed monthly repayment from a known date. A sole trader who buys the same ute on 10 July waits until October for the GST credit and goes into the new financial year without this year's write-off.
The most expensive mistakes in tradie finance come from buying the asset first and working out the structure later. Our job as broker is to get the structure, lender and timing lined up before the application goes in.
There's more on the trades finance page. If you've got a specific vehicle, plant or equipment deal in front of you, the application form is below. Most enquiries get a reply within four business hours.
Apply now or contact us to talk through the structure first.
Aurelius Capital Group Pty Ltd · Credit Representative 560751 of Viking Money Pty Ltd, Australian Credit Licence 471435 (Viking Aggregation Pty Ltd) · ABN 40 677 989 963 · CAFBA · AFCA