With an Equipment Loan, also referred to as a "Chattel
Mortgage", you own the asset but the financier takes security over
it until the contract is paid in full. Terms range from 1 to 5
years, with the option of a balloon or residual payment.
Equipment Loans can optimise your cash flow while
minimising the impact of GST, which is not payable on individual
repayments (as is the case with leasing). If your business is registered
for GST, you will be able to claim the GST portion of the purchase
as an input tax credit immediately to the percentage the equipment
or vehicle is used for business purposes.
Alternatively, you have the option of funding the GST portion of the invoice
price as part of the loan amount and have the loan structured to allow you
the input tax credit as a payment after the next BAS is lodged and credit received.