Transport Equipment Finance

Savvy’s guide to transport equipment finance for business – the solutions, tax benefits, and cost advantages explained

Transport Equipment Finance – Changing the Game

Technology is transforming business faster than ever before, and the transport industry is no different. At Savvy, we know to remain competitive and keep up with the pace of modern-day commerce, it’s essential you have up-to-date machines and vehicles – and that demands access to efficient, cost-effective funding that’s flexible enough to meet the specific needs of individual business models. With faster delivery times and increasingly sophisticated vehicles and equipment come higher customer expectations and stiffer competition – and tailored transport equipment finance can give your business the edge.

Find a Faster Route to Transport Equipment Finance

All businesses need to update equipment, tools, and machinery now and then – some more frequently than others. When that happens, the key to effective finance is making the right choices – and that presents two main requirements. Companies and owner-drivers need options, and they need fixed, clear cut costs so they can forecast for their future. At Savvy, we help thousands of Australia’s busiest transport operators find convenient, competitive finance solutions because we partner with more lenders and provide fast-track access to a broader range of specialist, industry-specific financial products.

Why So Many Transport Companies Choose Savvy

Compare more transport equipment finance options, more lenders, and find more competitive interest rates

Transport Equipment Finance Products – The Explainer

Before you make your next move, find out which asset finance option matches the way you trade with Savvy’s explainer

Transport Equipment Finance Products – What to Consider

There are three primary asset finance products, offered by a range of Savvy’s specialist lender partners, and all with their own tax, GST, and cost benefits.

  • Chattel Mortgages enable immediate recovery of GST, interest on repayments is tax-deductible, and businesses can use a deposit or adjust the residual amount to match repayments to projected revenue.
  • Finance Leases provide the full use of equipment during the term with an option to buy when the agreement ends. Repayments are fully tax-deductible and based on the GST-free value of vehicles or other assets.
  • Operating Leases are akin to a long-term rental. Payments are fully tax-deductible, and businesses get the option to bundle all operating costs and admin.

When you’re looking to finance equipment, it’s important to consider all the implications. It’s an excellent idea to consult your financial officer or accountant and then seek the advice of a finance consultant, to scour the entire lender marketplace. At Savvy, we help hundreds of transport companies each month to find the optimal and most cost-efficient equipment finance solution. We deal with a diverse selection of some of Australia’s best lenders, so products are more industry-relevant, competitive, and flexible.

Transport Equipment Finance Facilities: The Finance Lease

Finance Leases are based on terms that range between one and five years. The lender owns the asset until the end of the agreement, and a residual payment becomes due when the term ends. Finance lease residuals get based on ATO tables for depreciation, so they’re set according to the length of the lease. When that finishes, you can purchase the vehicle or equipment by paying the residual, refinance the amount and extend the lease, or sell the asset and start a new agreement.  

  • Lease payments are fully tax-deductible
  • Cost of the lease gets based on the ex-GST value of the truck or equipment

Transport Equipment Finance Facilities: The Operating Lease

An Operating Lease works somewhat like a fully maintained long-term rental agreement. The lender purchases the equipment and then rents

it to you for a fixed cost and term, which can run over anything from one to five years. Many transport businesses use operating leases to manage everything from single vehicles right up to larger fleets, removing the need for costly administration. Operating leases work well for equipment that depreciates quickly or needs to be upgraded frequently.

End-of-lease options are flexible. You can either hand the asset back, make an offer to buy the asset or extend the lease.


  • The cost of insurance, servicing, registration, and fuel can be bundled into regular payments
  • Zero ownership or residual risks
  • The whole of the regular lease payments are tax-deductible
  • Cost of the lease gets based on the GST-free value of the vehicle or equipment

Transport Equipment Finance Facilities: The Chattel Mortgage

Chattel Mortgage finance gets commonly used in the transport industry, where assets with relatively long service lives are used – such as trucks and trailers. Also known as an asset loan, a chattel mortgage is secured finance and has the advantage of a low interest rate. Your business owns the vehicle or equipment from the start of the term, and the lender registers a mortgage over it until the loan gets fully repaid, at which point you gain a clear title

  • Terms range between 12 months and seven years
  • Use an adjustable residual payment to tailor repayments to cash flow
  • Option to use a deposit or trade-in
  • Interest on repayments is tax-deductible
  • Claim back the purchase price GST when you next file a BAS
  • No GST on repayments or the residual

Your Frequently Asked Transport Equipment Finance Questions

Everything businesses frequently ask about asset finance. All your questions answered in Savvy’s FAQs Section

What are the advantages of transport equipment finance?

One of the primary benefits of using finance to purchase or lease assets comes from the preservation of working capital. Essentially, spreading the cost of relatively expensive equipment and vehicles makes sense for cash flow. Yet, that’s not the only reason transport companies and owner-drivers choose to finance trucks and other business assets:

  • Allows businesses to access the most modern, efficient trucks, vehicles, and equipment and compete more readily
  • When your business is expanding, equipment finance aligns investment with returns – placing less stress on your operation while you wait for new revenue to flow
  • Enables businesses to reduce costs by improving productivity, reducing delivery times, automating processes
What can I use equipment finance for?

There’s almost no limit to what you can buy or lease with equipment finance. Any asset that has a serviceable life of more than a year and will get used mainly for business purposes can be financed this way. Transport companies use asset finance to lease and buy:

  • Trucks and prime movers
  • Trailers
  • Loaders and forklifts
  • Office and computer equipment
  • Warehouse racking and storage systems
Can I use transport equipment finance with a bad credit rating?

Savvy partners with several specialist equipment finance lenders that will review applications from businesses with credit issues. Interest rates for such loans are generally slightly higher, and you may be asked to provide additional documentation or personal guarantees. One of Savvy’s expert business finance consultants should be your first port of call if you’re considering a bad credit equipment loan or bad credit truck loan

How does low doc asset finance work?

Low doc equipment finance is structured exactly like a chattel mortgage finance facility. The documents you’ll require to apply will depend on the lender, but the list below is a useful guide. Some low doc asset finance providers will consider applications with basic ID, an application form, and a signed income declaration. Still, the more information you can supply, the lower the interest rate you’ll pay. It’ll work in your favour if you can present any of the following:

  • Statements for your business account
  • A letter or appraisal compiled by your accountant
  • Any future orders or signed contracts
  • When you can’t access current ones, your previous business activity statements will help
What is a residual payment?

In the case of a finance lease, repayments get based on the depreciation during the term. That’s calculated using ATO tables and what remains is known as a residual or balloon payment – which is due at the end of the lease.


With a chattel mortgage agreement, you can choose the amount of the residual, although specific lenders will have their own guidelines. Upping or lowering the amount will lower or raise monthly repayments, so it’s a good way to regulate cash flow. With both finance leases and chattel mortgages, when the term ends, you can pay off the residual, refinance the residual, or trade your truck in and upgrade.

How do I qualify for equipment finance?

All lenders vary, but requirements are relatively straightforward:

  • The vast majority of equipment financiers will ask to see your previous two years of company tax returns and financial statements. If this is not available as mentioned previously a low doc option will suit that situation.
  • Some may wish to review directors’ personal tax returns too, and if your business is relatively young, lenders might want to see some projections and further evidence of revenue streams.
  • You’ll also need to supply copies of your basic ID, like a driver’s licence. Some providers may ask to see evidence of a premises lease, if applicable, and others may ask for details of any other business assets currently on your books.

Assets and equipment which are financed will also be required to have appropriate insurance policies covering them, and you’ll need to provide the financier with a certificate of insurance.