What Is Equipment Finance?
Equipment finance is a lending facility specifically designed to fund business equipment purchases. The equipment itself serves as the primary security — meaning you can acquire assets without pledging property or using existing credit lines.
Equipment you can finance through TFA:
- Heavy machinery and plant (excavators, cranes, processing equipment)
- Commercial vehicles (trucks, vans, trailers, company cars)
- Construction equipment (skids, compactors, loaders, mobile plant)
- Medical and dental equipment
- Restaurant and commercial kitchen equipment
- Mining and resources equipment
- IT, servers, and technology infrastructure
- Agricultural machinery
- Office fitouts and commercial furniture
If your business uses it to generate revenue, it can typically be financed.
Equipment Finance Structures
There are four main structures for equipment finance in Australia. Each has different accounting, tax, and ownership implications:
Chattel Mortgage
The most common business equipment finance product. You own the equipment from day one — the lender takes a mortgage over it as security. Interest and depreciation are fully tax-deductible. GST on the full purchase price is claimable upfront (on next BAS). Fixed monthly repayments throughout the term.
Best for: Businesses that want to own the asset, claim GST upfront, and have predictable repayments.
Finance Lease
The lender owns the equipment during the lease term. You pay lease repayments (fully tax-deductible as a business expense). At the end of the lease, you can purchase the equipment for a residual value, re-lease, or return it.
Best for: Businesses that prefer off-balance-sheet treatment, or where equipment will be replaced at the end of term.
Operating Lease
Similar to a finance lease, but structured as a true rental. The lender retains ownership risk, including residual value. Lease payments are fully expensed. Common for technology and equipment with rapid obsolescence.
Best for: Technology, vehicles, or equipment where regular upgrade cycles matter.
Hire Purchase
You hire the equipment throughout the term and automatically own it at the end once all payments are made. Similar tax treatment to chattel mortgage. Less flexible on residual values.
Best for: Businesses that want a clear path to ownership with structured payments.
Why Perth Businesses Choose TFA for Equipment Finance
Lender Access
TFA works with 20+ lenders across bank and non-bank equipment finance. This means competitive rates, flexible credit policies, and structures that actually fit your business — not just what one bank can offer.
Speed
Standard equipment finance can be approved and settled within 24–48 hours for sub-$150K equipment with a clean credit profile. TFA manages the documentation and lender relationship to get deals done fast.
Tax Optimisation
The right structure can make a significant difference to your effective borrowing cost. TFA works alongside your accountant to match the finance structure to your tax position — particularly relevant for businesses using instant asset write-off provisions.
Complex Scenarios
Mixed-fleet financing, equipment bundles, refinancing existing equipment debt, and financing used/private-sale equipment all require a broker who knows the market. TFA has structured deals that banks routinely decline.
Equipment Finance Rates and Terms
Equipment finance rates in Australia currently range from approximately 5.5% to 12%+ p.a. depending on:
- Lender (bank vs non-bank)
- Equipment type and age
- Business trading history (typically 2 years minimum for best rates)
- Credit profile of the business and directors
- Loan-to-value ratio
Terms typically run from 12 months to 7 years. Residual values are negotiable on lease products.
TFA will provide a full rate comparison across relevant lenders before you commit.
Frequently Asked Questions
Do I need to own property to get equipment finance?
No. Equipment finance is secured against the equipment itself — not property. This is one of its primary advantages for businesses that don’t own real estate or prefer to keep property security free.
Can a new business get equipment finance?
Yes, though options are more limited. Lenders will typically require a personal guarantee from directors and may apply higher rates for businesses under 2 years old. TFA works with lenders who specialise in start-up and early-stage business lending.
What is the maximum loan amount for equipment finance?
There is no fixed ceiling. Large-ticket transactions ($500K+) require additional documentation and may involve multiple lenders or structured facilities. TFA has arranged equipment finance in the millions for mining, construction, and industrial clients.
Can I finance second-hand equipment?
Yes. Most lenders will finance used equipment provided it is in working condition and valued appropriately. Private sale purchases (from another business, not a dealer) are also financeable — TFA manages the additional documentation required.
Is equipment finance interest tax-deductible?
Under a chattel mortgage or hire purchase, interest payments are tax-deductible for the business. Under a finance lease, the full lease payment is deductible. Always confirm with your accountant — but equipment finance is generally highly tax-efficient for businesses.
Get a Quote
The Finance Agency arranges equipment finance for Perth businesses across all industries. Call or book online for a same-day assessment.
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The Finance Agency | MFAA Member | Perth-Based | 15+ Years Experience | $500M+ Settled