Equipment finance for vehicles, trucks, trailers or any equipment
If you or your business requires this type of finance, we have access to these facilities through Central Coast Finance which operates from the same office as Central Coast Home Loans.
When considering finance for your car, truck, trailer or any other equipment the following options are available. We do recommend that you consult your accountant about which option suits your business/personal interests the best.
Available for companies and business to buy cars or vehicles. A hire purchase arrangement is an agreement to purchase car or vehicle subject to payment terms. During the term of the agreement, the financier owns the car or vehicle. Ownership is automatically transferred to you when you make the final payment.
CHANGE TO GST AND HIRE PURCHASES – 1st July 2012
Previously GST was only payable on the purchase price of the car or vehicle, but as of 1st July 2012 GST will be payable on the purchase price of the car or vehicle and all interest (term charges) and any fees. The GST on interest and fees will be payable at settlement of the loan, and can be added to the loan or paid upfront.
- You own the car or vehicle when the final repayment is made
- You can purchase the car or vehicle at any time during the terms of the agreement
- There is no need for a deposit
- Flexible repayment arrangements maximise cash flow
- The interest component of the repayments and the depreciation on the car or vehicle may be claimed as tax deductions, provided the car or vehicle is used to generate assessable income
- You can also arrange to make a balloon payment at the end of the facility to reduce repayments throughout the term
- The repayments are fixed throughout the term of the facility
Chattel Mortgage (or Bill of Sale, Equipment Loan)
Available for companies and business to buy cars or vehicles which are for business use more than 50% of the time. It is a loan agreement where you borrow funds to acquire an asset. You provide security for the loan by way of a mortgage to the Bank over the asset financed.
- You are generally not required to provide a deposit
- Repayments may be tailored to suit your cashflow
- You don’t pay GST on the loan or the repayments
- You retain ownership of the car or vehicle throughout the term of the loan
- The interest component of the payments and the depreciation on the asset may be tax deductible, provided you use the car or vehicle to generate assessable income
- If you are registered for GST, you can claim the GST portion of the car or vehicle price on your next BAS if you use the cash accounting method
- You can arrange to make a balloon payment at the end of the loan to reduce payments throughout the term
Financier purchases the car or vehicle you require and then leases the goods to you. You then enjoy the use of the car or vehicle for an agreed time in return for rental payments.
- Preserve your working capital with 100% financing
- If you use the car or /vehicle to generate income, rental payments may be tax deductible
- You may be entitled to claim an input tax credit for rental and other charges that are subject to GST
- The rentals are fixed throughout the term of the lease
For employees who have the option of receiving a car or vehicle as part of their salary package. The employer pays all rental payments to the financier and the employee enjoys full use of the car or vehicle. The employee chooses a car or vehicle and leases it from the financier. The employee then novates the lease to their employer, who assumes some of the employee’s rights and obligations under the lease, including responsibility of meeting the lease rentals. The contract is in the name of the employee who remains the registered owner throughout the lease and keeps effective control of the car or vehicle at all times. If the employee leaves the company, the car or vehicle remains with the employee. In this situation generally the employee takes over the payments or gets another employer to make the payments. This means the original employer is not left with and unwanted car or vehicle and the employee keeps the car or vehicle.
- Use of the car or vehicle without having to budget for the repayments
- Complete choice about what car or vehicle you buy and where you buy it from
- Retain the car or vehicle even if changing employment
- If the employee leaves, the company is not left with an unwanted car or vehicle
- The employer can provide the employee with a car or vehicle without having to reflect it on its balance sheet