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How does equipment financing work for Australian businesses?

Equipment financing allows Australian businesses to acquire machinery, vehicles, and technology by spreading the cost over the asset's useful life. The equipment itself serves as security, making approval more accessible. Options include chattel mortgage (ownership from day one, GST claimed upfront), finance lease (flexibility with a purchase option at end of term), hire purchase, and operating lease. Requirements: valid ABN, 6+ months trading, $5,000+ monthly revenue, and 6 months of bank statements. Rates vary based on equipment age, business profile, and finance term, and are disclosed before you sign.

Equipment Finance

Business equipment finance & loans

Acquire the machinery, vehicles, and technology your business needs without depleting working capital. Fund $5,000 to $350,000 with flexible structures — chattel mortgage, finance lease, hire purchase, or operating lease — and approval decisions in 2-5 hours.

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Equipment finance for Australian businesses
$5K–$350K
Finance range
Same day
Funding speed
2-5 hrs
Approval time
No property
Security required

How it works

How business equipment finance works

Spread the cost over the asset's useful life. Keep cash available for wages, rent, and stock while the equipment generates revenue from day one.

Equipment finance allows your business to acquire physical assets by spreading the cost over a set term. Rather than paying the full purchase price upfront and draining working capital, you make regular repayments while the equipment generates revenue from day one. The asset itself typically serves as security for the finance, which reduces lender risk and generally results in more competitive rates than unsecured lending.

The process is straightforward: submit a 2-minute application with your business details and an equipment quote from your supplier, provide 6 months of bank statements for assessment, and receive an approval decision within 2-5 hours. Once approved and you accept the terms, funds are deposited within hours so you can complete the purchase and put the equipment to work immediately.

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Structures

Types of business equipment finance

Four primary structures are available in Australia, each with different implications for ownership, tax treatment, and cash flow.

Chattel Mortgage

A loan secured against the equipment where your business owns the asset from day one. The lender registers a security interest on the PPSR, which is removed once the loan is fully repaid.

  • Ownership from settlement — claim GST upfront
  • Interest and depreciation are tax-deductible
  • Optional balloon payment to reduce monthly repayments

Finance Lease

The lender purchases the equipment and leases it to your business for an agreed term. At the end, you can purchase it at a pre-agreed residual value, extend the lease, or return it.

  • GST claimed progressively on each payment
  • Lease payments are tax-deductible
  • Flexibility to purchase, extend, or return at end of term

Hire Purchase

The finance company purchases the equipment and hires it to your business over an agreed term. Ownership transfers once all payments, including any residual, are complete.

  • GST claimable upfront on full purchase price
  • Interest and depreciation are tax-deductible
  • Asset appears on balance sheet from the start

Operating Lease

A true rental arrangement where the lender retains ownership throughout. At the end of the term, the equipment is returned with no residual risk to your business.

  • Lower monthly payments than other structures
  • Full lease payment is a tax-deductible expense
  • Ideal for equipment that depreciates quickly or needs regular upgrades

Industries

What equipment can be financed?

Almost any tangible business asset with a defined useful life and resale value can be financed across a wide range of industries.

Construction

Heavy machinery and site equipment

  • Excavators and loaders
  • Cranes and telehandlers
  • Concrete pumps and mixers

Transport & Logistics

Vehicles, trailers, and fleet assets

  • Prime movers and trucks
  • Refrigerated trailers
  • Forklifts and warehouse gear

Healthcare

Medical and diagnostic equipment

  • Imaging and X-ray machines
  • Dental chairs and CAD/CAM
  • Practice fit-out equipment

Hospitality

Commercial kitchen and service equipment

  • Commercial ovens and fryers
  • Coffee machines and POS systems
  • Cool rooms and refrigeration

Manufacturing

Production machinery and tooling

  • CNC machines and laser cutters
  • Production lines and conveyors
  • Welding and fabrication gear

Agriculture

Farming equipment and machinery

  • Tractors and harvesters
  • Irrigation systems
  • Processing and storage equipment

Eligibility

Business equipment loan requirements

Because the equipment itself serves as security, eligibility is generally more accessible than for unsecured lending.

Active ABN

Your business must have a valid, active Australian Business Number

6+ Months Trading

At least six months of continuous trading history is required

$5,000+ Monthly Revenue

Minimum monthly turnover demonstrated through bank statements

Equipment Quote

A detailed quote from the supplier specifying make, model, and price

Bank Statements

6 months of business bank statements for cash flow assessment

Australian-Based

Your business must operate within Australia

Credit history is considered but is not a dealbreaker. Because the equipment provides built-in security, businesses with less-than-perfect credit can still be approved when their cash flow supports the repayments. For more on how alternative lenders assess applications, see our bad credit business loans guide.

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Tax

Tax benefits of equipment financing

The right structure can significantly reduce the effective cost of acquiring equipment. Always consult a qualified accountant for advice specific to your situation.

Instant Asset Write-Off

Eligible businesses can deduct the full cost of qualifying assets in the income year the asset is first used. With a chattel mortgage or hire purchase, you are treated as the owner for tax purposes and can claim the write-off if the asset falls under the current threshold. Thresholds change regularly, so always check with your accountant.

Depreciation Deductions

For assets above the write-off threshold, businesses can claim depreciation over the asset's effective life as determined by the ATO. Both diminishing value and prime cost (straight-line) methods are available. This applies to chattel mortgages and hire purchase arrangements where the business is treated as the asset owner.

GST Advantages

GST-registered businesses can claim the full GST credit upfront with a chattel mortgage or hire purchase, providing an immediate cash flow benefit. On a $100,000 piece of equipment, that is a $10,000 GST credit claimed in the next BAS period rather than spread over years of lease payments.

FAQ

Frequently asked questions

Everything you need to know about equipment finance in Australia.

What is equipment finance?
Equipment finance is a lending arrangement that allows businesses to acquire machinery, vehicles, technology, and other physical assets without paying the full cost upfront. The equipment typically serves as security for the finance, which generally makes it more accessible and competitively priced than unsecured lending. Repayments are spread over an agreed term that usually aligns with the equipment's useful life, and depending on the structure chosen, the business either owns the equipment outright at the end or has the option to purchase, extend, or return it.
Should I lease or buy business equipment?
The decision depends on your business circumstances. Buying (via chattel mortgage or hire purchase) is suited to businesses that want ownership, plan to use the equipment long-term, and want to claim depreciation and GST credits upfront. Leasing (finance lease or operating lease) suits businesses that prefer lower monthly payments, want flexibility to upgrade regularly, or use equipment that depreciates quickly. Consider your tax position, cash flow, how long you will use the equipment, and whether ownership matters for your balance sheet.
What equipment can be financed?
Almost any tangible business asset with a defined useful life and resale value can be financed. Common examples include construction equipment such as excavators and cranes, transport vehicles including trucks and trailers, healthcare equipment like diagnostic and dental machines, manufacturing machinery such as CNC machines and production lines, hospitality equipment including commercial ovens and coffee machines, and agricultural machinery. The equipment itself typically serves as collateral, making finance more accessible than unsecured options.
What are the requirements for equipment finance?
Common minimum criteria include an Australian registered business with a valid ABN, at least 6 months of trading history, minimum monthly revenue of $5,000 to $10,000, no recent bankruptcy or insolvency events, and a clear or explainable credit history. You will need 6 months of bank statements, a detailed equipment quote from the supplier, business identification, and potentially recent financial statements for larger amounts. The equipment itself serves as security, so no property collateral is required.
How does equipment serve as collateral for the finance?
With equipment finance, the asset being purchased acts as security for the loan. The lender registers a security interest on the Personal Property Securities Register (PPSR) against the equipment. If the borrower defaults, the lender has the right to repossess the asset. This built-in security reduces the lender's risk, which generally means more competitive rates and higher approval rates compared to fully unsecured business loans. Once the finance is fully repaid, the security interest is removed.
What are the tax implications of equipment finance?
Tax treatment depends on the finance structure. With a chattel mortgage or hire purchase, you can claim GST upfront on the full purchase price and deduct interest plus depreciation. You may also be eligible for the instant asset write-off if the asset falls under the current threshold. With a finance lease, GST is claimed progressively on each payment, and lease payments are deductible as operating expenses. Operating lease payments are fully tax-deductible but you cannot claim depreciation since you do not own the asset. Always consult your accountant for advice specific to your situation.
How fast can equipment finance be approved?
With Velociti Capital, equipment finance applications are typically assessed within 2-5 hours during business days. Once approved and you accept the offer, funds can be in your account within hours. The process involves a 2-minute online application, submission of 6 months of bank statements, and a detailed quote for the equipment you want to finance. For straightforward applications submitted before midday, same-day funding is often achievable.
What interest rates are typical for equipment finance?
Equipment finance rates in Australia vary based on several factors: your business credit profile, trading history, the type and age of the equipment, the finance term, and the amount being financed. Strong applications — established businesses with good credit financing newer equipment — attract the most competitive rates. Your exact rate is disclosed in your finance contract before you sign.

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