Guide
Chattel mortgage, explained like you're standing at the counter.
What a chattel mortgage actually is, how it's taxed, when it beats a lease or rental, and who it suits — explained in plain English by a Brisbane asset finance broker. Plus a repayment calculator.
Chattel mortgage is the most common way Australian businesses buy trucks, machinery and equipment — and the name does it no favours. Strip the legal coat off it and it's simple: the business owns the gear from day one, the lender holds a mortgage over it until it's paid off, and you claim what you're entitled to claim along the way.
Here's the plain-English version — no law degree required.
How it actually works
You find the asset. The lender pays the seller. The asset is registered in your business name — it's yours — and the lender takes a security interest (the 'mortgage') until the loan's repaid. You use the gear, it earns for the business, and the repayments come out of cash flow like any other cost.
At the end of the term (with any balloon paid out), the security lifts and it's just yours. No residual gymnastics, no hand-back, no inspecting the vehicle at lease-end for excess wear. It's the closest thing to a straightforward business loan with the asset as security.
The tax side (briefly, because it matters)
For GST-registered businesses, the GST in the asset's price is generally claimable on your BAS in the period you buy — the full amount up front, not drip-fed through repayments. Interest and depreciation are generally deductible where the asset earns business income.
That's the general picture — not tax advice. Your accountant confirms what applies to your setup, and we'll structure the finance to give them something easy to work with.
Chattel mortgage vs lease vs rental
A finance lease keeps ownership with the lender during the term (you're effectively renting with a commitment to see it through); a rental/operating lease is genuinely pay-as-you-go with no commitment to own. Chattel mortgage puts ownership on your side from day one.
Rule of thumb from our desk: if you want to own the asset and your accountant likes the upfront GST treatment, chattel mortgage. If repayments need to be fully deductible and the asset turns over every few years, lease territory. We'll price both side by side if the choice isn't obvious.
Who chattel mortgage suits
Businesses buying a long-lived asset they intend to keep: owner-drivers and their trucks, contractors and their excavators, workshops and their machinery, tradies and their utes. If it earns for the business and holds value, chattel mortgage is usually the first structure we look at.
Terms run 12 months to 7 years depending on the asset, with balloon options to shape the repayments. Run your numbers on our calculator, then call us for real ones — calculator estimates are a starting point, and quotes from our panel usually come in 1–2 points better.
Crunch the numbers on the calculator, then call for a real quote — usually within a day.
Average response under 2 hours during business hours.
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