Latest Post. What are Modern Employment Awards? A Lost Trust Deed! The chattel mortgage allows businesses to claim the full input tax credit from GST incurred expenses immediately next BAS statement. Those using their motor vehicles for business purposes can take out a hire purchase loan or chattel mortgage but will have to keep a log book and document the percentage of the vehicle use that is for business, which is tax-deductible.
The terms of both products are essentially the same, including the balloon payment at the end, but the chattel mortgage has overtaken popularity over hire purchases since the introduction of GST and the Business Activity Statement BAS.
Of course, as long as you are registered for GST and the asset being purchased is for business use, then this GST will be claimed back as an input tax credit on the next BAS so the net effect is nil.
The other important change that came into effect is that the GST can be claimed back immediately even for customers on cash accounting. Previously, if a client is on cash accounting, then the GST paid for an asset on hire purchase must be claimed progressively over the term of the hire purchase in proportion to the principle reduction made with each payment — in other words, an accountants worst nightmare.
Jody Benson is the principal and founder of Benson Leasing Group and is a second generation financier with 20 years experience in finance and leasing. Jody is also a financial advisor and financial planner and has a passion for leasing. Shopping around for the right loan can save you thousands of dollars in interest and fees. Chattel Mortgage Advantages.
Types of Lease available to Australian businesses. Operating Lease — A short-to-mid-term lease used for assets which may become quickly obsolete — such as computers and IT equipment — and the lender will take on both the risks and benefits of ownership.
Finance Lease Advantages. Operating Lease Advantages. Other types of business finance. Need fast access to finance or a one-time credit facility? Short-term business loan Unsecured business loan Invoice finance Business line of credit Business overdraft Have a unique need for business finance? Fit-out finance Inventory finance Business caveat loans Business tax debt loans Purchase an existing business Business partner buyout Self-employed business loans Bad credit business loans Need a new business vehicle or equipment for your business?
Equipment finance Asset finance Truck finance Business car loans. What is the difference between a chattel mortgage, lease, and hire purchase? Where can I get a chattel mortgage, lease or hire purchase?
Typical chattel mortgage terms range from two to seven years. You can also set up the repayment frequency to suit your business' cash flow. For example, you can choose weekly, fortnightly or monthly repayments. You can also structure your repayments to suit your business' seasonal cash flow. You can choose a fixed interest rate to ensure certainty of your repayment amount. You can also choose a variable interest rate option if you'd prefer.
You can lower your regular monthly repayments by arranging a larger final payment. This larger final payment is called a " balloon " or residual value payment. When it comes time to make the final payment, you can choose to refinance the vehicle or trade it in instead. Your business-use vehicle expenses will also be tax-deductible.
For example, expenses like petrol, registration, insurance and servicing costs.
0コメント