28th September 2026 | Murray

A chattel mortgage lets you buy workshop tools now and pay them off through fixed monthly repayments while you use them to generate income. You own the equipment from day one, claim the full purchase as a tax deduction, and keep your cash available for wages, materials, and other operational expenses.
In our experience, workshop operators delay equipment purchases because they assume paying cash is the only option. It's not. Equipment finance exists specifically to solve this problem, particularly when the tools you need cost $20,000, $50,000, or more.
A chattel mortgage is secured against the equipment itself, which means the tools act as collateral. The lender doesn't need additional security in most cases, and you can structure repayments to match how the equipment generates income.
Consider a panel beater in Mackay who needs a spray booth and compressor system. The total cost sits around $80,000. Paying cash wipes out working capital. A chattel mortgage spreads that amount over three to five years with fixed monthly repayments, and the full loan amount is typically tax deductible. The business keeps cash on hand, the equipment starts earning from the first job, and repayments come from revenue the tools help create.
The equipment is registered on your business balance sheet as an asset. At the end of the term, you own it outright. There's no balloon payment unless you structure one deliberately to lower monthly costs.
Repayment terms usually range from one to seven years depending on the expected life of the equipment. Shorter terms mean higher monthly repayments but lower total interest. Longer terms reduce the monthly cost but increase what you pay overall.
For workshop tools that get heavy use, match the loan term to how long the equipment will remain productive. A CNC machine with a ten-year lifespan might suit a five-year term. Hand tools or smaller equipment with faster depreciation should sit on a shorter term to avoid paying off something that's already worn out.
You can also add a residual value, sometimes called a balloon payment, at the end of the term. This lowers your monthly repayment but leaves a lump sum due when the loan finishes. It works if you plan to refinance, sell the equipment, or have cash available at that point.
Lenders assess your business financials, not just your credit score. They want to see consistent revenue, manageable debt levels, and a business that can service the repayments without stress. Most lenders ask for recent tax returns, profit and loss statements, and a business bank statement covering the past three to six months.
The equipment itself plays a role. Lenders prefer tools and machinery with a clear resale market because it reduces their risk. Standard workshop equipment like lathes, welders, lifts, and diagnostic machines usually get approved faster than highly specialised or custom-built items.
If your business is relatively new or your financials show variability, expect the lender to ask for a larger deposit or a director guarantee. That's standard. It doesn't mean you won't get approved, but it does mean the terms might shift slightly.
Upgrading workshop tools keeps your business competitive, but it also creates a cashflow problem if you pay upfront. Equipment finance solves this by letting you replace outdated machinery while keeping your working capital intact.
A diesel mechanic in Townsville running a two-bay workshop might need to replace an ageing hoist and add a second diagnostic scanner. Combined cost is around $35,000. Paying cash means pulling money from the business account that would otherwise cover three months of operating costs. Financing the purchase through a chattel mortgage keeps that cash available and spreads the repayment over four years. The tools are tax deductible, the monthly repayment is predictable, and the business maintains its cashflow buffer.
The same approach works for adding automation equipment, buying specialized machinery, or expanding capacity. If the equipment generates more revenue than the repayment costs, the decision pays for itself.
When you finance workshop tools through a chattel mortgage, you can claim the full purchase price as a tax deduction in the year you buy it under instant asset write-off provisions, depending on your eligibility and the current threshold. If the equipment exceeds that threshold, you depreciate it over its effective life.
You can also claim the interest portion of your repayments as a tax deduction each year. This makes equipment finance tax effective compared to paying cash, because you're spreading the cost while still accessing the deductions.
Talk to your accountant before committing to any structure. They'll confirm what applies to your situation and help you time the purchase to maximise the deduction.
Not all lenders offer the same terms, and some specialize in certain industries or equipment types. A broker compares equipment finance options from banks and non-bank lenders, matches the right product to your business needs, and handles the application process.
Some lenders approve smaller amounts quickly with minimal paperwork. Others suit larger purchases or businesses with complex financials. A broker knows which lender to approach based on your situation, which speeds up approval and often results in better terms than applying directly.
If you're also looking at other business funding, like a commercial loan or asset finance for vehicles, a broker can structure everything together so it works as a cohesive plan rather than separate applications.
Delaying equipment purchases to save cash sounds sensible, but it often costs more in lost productivity, missed jobs, or repairs on old machinery. If the tools you need will increase capacity, reduce labour time, or let you take on higher-margin work, the revenue gain usually outweighs the repayment cost.
Equipment finance turns a large upfront cost into a manageable monthly expense. You start using the tools immediately, generate income from them, and pay them off over time. The alternative is waiting months or years to accumulate cash, during which your competitors are already using the latest technology.
Call one of our team or book an appointment at a time that works for you. We'll assess your business needs, compare finance options, and structure a solution that keeps your cashflow intact while you buy the workshop tools you need.
Banks can only offer their own products and lending rules. We work with a broad panel of major banks, non-bank and specialist lenders, giving us the ability to compare a wide range of finance options and structures to find the right fit for your circumstances.
We also look beyond the individual loan. Where appropriate, we can help diversify your lending across different lenders and structures, reducing concentration risk and helping you maintain greater flexibility and control over your business and personal assets.
The right structure depends on what you're buying, how the asset will be used, your business cash flow and how long you intend to keep it.
Typically for most businesses a Chattel Mortgage or Commercial Loan is the recommended finance product, this is because the product gives the business full control and ownership of the asset with all the claimable benefits available to the business. We arrange finance for business cars, utes, trucks, trailers, machinery, plant and other equipment across a wide range of lenders. Our process is to obtain our clients highly competitive rates and more importantly the right structure and agreement that does not create risky charges from lenders. We consider the overall finance structure, including loan term, deposit, balloon or residual, repayment requirements and lender security, so the finance works with your business rather than unnecessarily tying up cash or other assets.
We can also arrange finance for new and used assets purchased through dealers, suppliers or, with selected lenders, private sellers.
In most cases, yes.
Established businesses are generally eligible for streamlined or reduced documentation asset finance depending on the amount being borrowed, the asset, your ABN and GST history, credit profile and the lender's individual policy.
Lenders however, are not the same, they have different rules when considering the above, it's important to have representation from a good finance broker who knows the landscapre and can workshop your position if necessary before applying anywhere.
We work with a wide range of business asset finance lenders, each with different credit policies and documentation requirements. We can assess your position first and identify lenders that are more likely to suit your circumstances before an application is submitted.
This can be particularly useful when you need to purchase a vehicle or equipment quickly without going through a lengthy full financial assessment.
It depends on what you're trying to fund.
A business overdraft or line of credit can be useful for managing ongoing cash flow fluctuations because funds can generally be accessed quickly, repaid and used again within the approved limit. A term business loan may be more appropriate when you need a defined amount for a particular purpose or investment.
We look at how cash actually moves through your business, what the funding is being used for and how quickly it is likely to be repaid before recommending a structure.
The objective isn't simply to obtain more debt, it's to put the right funding in place so your business has access to capital when it needs it without unnecessarily restricting future growth or putting assets at risk.
Commercial property lending varies considerably between lenders and depends on the type of property, its location and use, your deposit or available equity, lease arrangements and the financial strength of the borrowing business or investment entity.
We arrange commercial property finance for business premises, industrial property, warehouses, offices, retail and investment properties through major banks and specialist commercial lenders.
For business owners, we also look at how the purchase fits alongside your existing business lending, property debt and available security. Structuring this correctly can be just as important as the interest rate, particularly when you want to preserve equity and borrowing capacity for future opportunities.
Generally, yes.
An SMSF can, subject to superannuation rules and the correct legal structure, borrow to acquire certain commercial property. For business owners this may include premises that are subsequently leased to their operating business under appropriate commercial arrangements.
SMSF lending is a specialist area and lender policies can vary considerably. We compare SMSF commercial property lenders and work alongside your accountant, financial adviser and solicitor to coordinate the lending component of the purchase.
Because the SMSF, borrowing structure, property and lease arrangements all need to work together, it's important to investigate the finance position before committing to a property.
Yes. This is one of the advantages of working with Premium Finance Group Australia.
Business owners often have income spread across salaries, company profits, dividends, trusts or other entities, which means their financial position doesn't always fit neatly into a standard home loan application.
We understand business financials and can consider lenders with different approaches to assessing self employed income for home loans, investment property finance and refinancing.
More importantly, we can look at your business and personal lending together. That helps avoid making a decision on a home, investment or business loan today that could unnecessarily restrict your borrowing capacity, security position or options later.
It costs absolutely nothing to speak with us.
In most cases, we're paid by the lender, which means our services will not cost you anything directly. We'll always explain how we're remunerated so you can make an informed decision.
Absolutely. Refinancing can help you secure a lower interest rate, change repayment obligations, access equity in property, divesify debt risk and help protect your assets when there is business debt. We access loan options from banks and lenders across Australia and provide you options and recomendations to consider.
Real experiences from Australian businesses we’ve helped finance and grow.