Business Car Finance

Explore business car finance options tailored to your company's needs.

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Business Car Finance
Last Updated: 27/03/2025
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Business car finance covers a range of products designed to help businesses buy or lease vehicles for commercial use. From small operations to large enterprises, choosing the right finance option can make all the difference.

At Savvy, we offer a wide range of commercial car loan and lease products tailored to suit your business needs. Explore your business car finance options with us today!

Why apply for a car loan with Savvy?

100% online

There’s no need for messy paperwork with us. When you apply, you’ll be able to submit and sign all your forms electronically.

4.9-star customer service

The satisfaction our customers feel is clear when you see our impressive 4.9-star rating for our service on Feefo.

Helping Aussies since 2010

We’ve been helping Australians just like you find their ideal car loan package and save on interest and fees for 15 years.

No impact on your credit score

Our consultants will conduct a soft credit check when assessing your application, so your score won’t be affected.

40+ lending partners

We’re partnered with over 40 car loan providers nationwide, giving you more high-quality options to consider.

Competitive interest rates

We scour our lending panel for the lowest rates and match you with the most affordable deal available for your profile.

Types of business car loans

Whether you’re looking to fund a single vehicle for your company or a whole fleet, there are four main products to consider under the business car finance umbrella:

  • Chattel mortgage

    chattel mortgage is the only type of business car finance where you own the vehicle from the start. It’s structured in much the same way as a secured car loan, with repayment periods extending from one to seven years on a weekly, fortnightly or monthly basis. 

  • Hire purchase

    Under a hire purchase agreement, your financier purchases the vehicle on your behalf and hires it out to you in return for ongoing payments. Once your business has repaid the full purchase price of the vehicle, ownership is transferred to you. 

  • Finance lease

    Under a finance lease, your financier buys a car and leases it to your business, with monthly costs charged to hire the vehicle. At the end of your lease, you can choose whether to buy the car by paying the residual out of pocket, trade in or sell the car to cover the residual and lease another car, or refinance the residual and extend the term of your lease.

  • Operating lease

    Operating leases work in the same general way as finance leases, except they don’t come with a residual payment and instead enable you to hand the car back after the lease. On-road costs are also typically sorted for you and incorporated into your loan, making it more expensive but leaving the risk of vehicle obsolescence with the lessor, not you.

While technically not a business car finance option, there is also novated leasing. This option is generally more suitable for companies that want to also allow employees to use their vehicles for personal use and receive tax benefits.

Which option should I choose?

The best business car finance option for your company will depend on how you plan to use your vehicles, your cash flow and whether you prefer to own or lease. For example, if your business has changing vehicle needs which is often the case for companies with larger fleets an operating lease can offer flexibility with managed services and no ownership risks. A chattel mortgage or hire purchase agreement, meanwhile, suits businesses looking to build their assets while spreading the cost over time. Finance leases can offer a middle ground, giving you the flexibility to either buy the vehicle at the end of the term or return it. If you’re unsure which way to go, you can explore your options through Savvy.

How to apply for business vehicle finance

If you’re looking to buy vehicles outright for your business rather than lease them, a chattel mortgage is one of the most popular and tax-effective options. Here’s how to apply for this type of loan with Savvy:

  1. Complete our simple online form

    Start by filling out the short form on our website. Tell us about your business, the vehicle(s) you want and how much you’re looking to borrow.

  2. Provide your documents

    You’ll need to provide supporting information, such as ID, proof of income or business financials. This helps us verify your eligibility and match you with suitable lenders.

  3. Compare your finance options

    Your Savvy consultant will review your profile and compare loan offers from our lending panel. They’ll call you to discuss the best deals tailored to your needs and circumstances.

  4. Lock in your vehicle

    If you haven’t chosen your vehicle(s) yet, now’s the time. Our in-house car broker team can even help source the right car, van or ute for your business.

  5. Submit and finalise your application

    We’ll prepare your application and send it off to your chosen lender. Once approved, your consultant will guide you through the next steps.

  6. Sign and settle

    Once you sign the loan documents, we’ll handle settlement. Your funds will be sent to the dealer or vendor, and the vehicle will be transferred to your business.

How can a business vehicle be used?

A business vehicle can be used for a range of purposes, such as making deliveries, attending client meetings, travelling to work events or conferences, or transporting tools and equipment. It can also be assigned to an employee for regular use – but any personal use needs to be carefully managed.

Under both chattel mortgages and commercial car leases, a business vehicle must be used predominantly (more than 50%) for business purposes. While it can be used for personal reasons, such as commuting, weekend trips or school drop-offs, this may attract Fringe Benefits Tax (FBT). This is a tax paid by businesses on certain benefits provided to employees, including personal use of a company car. Charged at a rate of 47%, it can significantly add to business costs. 

Note that if you are a sole trader or a partner in a partnership, you’re not considered an employee, so any benefits you provide to yourself – including vehicle use – aren’t subject to FBT. However, you’ll still need to track business and personal use to correctly claim tax deductions.

How much does a business car loan cost?

There’s a range of variables that can impact the cost of your business car loan. These include:

  • Interest and fees: the higher your rate and more costly the fees charged, the more you’ll pay as part of your loan agreement. For example, on a $30,000, five-year loan repaid monthly, the difference between 6.99% p.a. and 7.99% p.a. is over $850. However, you may not be liable to pay any interest if you use the car for business purposes 100% of the time.
  • Loan size: larger loans will attract more interest. For instance, a $30,000 loan repaid monthly over five years with 6.99% p.a. interest will attract $5,219 in interest, but increasing the sum to $120,000 for a more expensive vehicle like a truck loan causes this to rise to $20,876.
  • Loan term: the longer you take to repay the loan, the greater your interest spend will be. Compared to the $30,000 loan example mentioned above, lengthening your term to seven years will cost $8,653, which is almost $2,500 more.
  • Deposit: by putting up a larger deposit, you’re reducing the size of your loan and cutting down on your interest spend as a result. On the same $30,000 seven-year loan example above, a $3,000 (10%) deposit would reduce your interest by over $1,400.
  • Repayment frequency: making additional repayments will help you pay off your car loan faster and save you on interest. By contributing an extra $100 per month on a $30,000, five-year car loan repaid monthly at 7.50% p.a., you’d save over $1,000 and have your debt cleared ten months early.
  • Residual: opting for a residual or balloon payment reduces your regular repayments but means a lump sum is due at the end. For example, a $30,000 five-year loan at 7% p.a. with a $9,000 (30%) residual would cut your monthly repayments by around $170 compared to a loan with no residual. However, you’ll still need to pay off the $9,000 at the end of the term if you want to keep the car.

What tax benefits are available through business car finance?

Motor vehicle tax deductions refer to expenses associated with owning and operating a vehicle that are eligible for tax relief or deductions. These deductions are available to employees, sole traders and businesses in Australia using their vehicles for work-related purposes, subject to criteria set by the ATO. You might also be eligible to claim GST tax credits.

The tax benefits available to your business will vary depending on the type of car lease or loan arrangement you take out and the nature of your business’ usage of the vehicle. Here's what you could claim for each arrangement:

  • Chattel mortgage: GST on the purchase of the vehicle, interest on loan repayments, depreciation and instant asset write-off (if eligible)
  • Hire purchase: GST on the purchase (claimable by the financier), interest on loan repayments, depreciation and instant asset write-off (if eligible)
  • Finance lease: up to 100% of the cost of leasing payments
  • Operating lease: up to 100% of the cost of leasing payments

Expenses that the ATO considers claimable include:

  • Depreciation
  • Fuel
  • Insurance premiums
  • Tolls
  • Oil
  • Repairs and servicing
  • Interest or lease payments
  • Vehicle registration

However, costs like licence renewal, fines and penalties are not tax deductible. Furthermore, if you use a car under a salary sacrifice arrangement or novated lease, be aware that you cannot claim running costs, though you may be able to claim additional expenses.

You can also only claim for your vehicle’s business use. For example, if you lease a vehicle and use it 65% for business, you can typically claim 65% of your payments and related expenses. While this does not generally cover travel between your home and place of work,  you can claim tax deductions for trips to client meetings and conferences and temporary worksites.  

Likewise, the amount you can claim for GST is determined by business usage. Businesses that exclusively use their vehicles for commercial purposes will be able to claim the full GST amount (up to the set car limit), while those buying a car for both business and personal use in Australia can claim a partial credit.

This information only serves as a guide, so speak to your accountant or a tax professional for more information specific to your situation.

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Business car loan residuals

A residual payment, also known as a balloon payment or a residual value, is a lump sum attached to the end of a loan or lease to be paid at the conclusion of the agreement. Residuals work differently depending on whether you’re taking out a commercial loan or lease.

Car lease residual

Residual values for car leases are set by the ATO and are intended to reflect the estimated value of the vehicle at the end of your term. The minimum required residual values for car leases are as follows:

Lease term Residual value
12 months
65.63%
24 months
56.25%
36 months
46.88%
48 months
37.5%
60 months
28.13%

Source: Australian Taxation Office (ATO)

These only represent minimum guidelines, so you may find your leasing company sets your residual at a higher cost.

Car loan residual

Unlike leasing residuals, those attached to a chattel mortgage can be set at whatever amount you or your lender requires. It’s important to note that having a residual attached to a loan will reduce its month-to-month cost but increase the amount of interest charged overall. You can see how this works in the table below:

Balloon payment Repayments Total interest Total saving
$6,000
$519
$7,105
N/A
$3,000
$560
$6,587
$519
$1,500
$581
$6,328
$777
$0
$602
$6,069
$1,037

Calculations based on a $30,000 car loan repaid monthly over five years with a 7.50% p.a. interest rate.

Business car finance FAQs

Should I buy a car through my business or purchase it personally?

Whether you buy a car through your business or privately will depend on your individual situation. If your vehicle will be used 100% of the time for business purposes, you may decide the best solution is to make the purchase through your business.

When you buy a car through your business you will have a wide range of potential tax deductions, while purchasing a car privately allows you to avoid fringe benefits tax (FBT).

Is business car financing available to self-employed workers?

Yes – self-employed workers are treated in the same way as any other business when it comes to financing their car: provided you meet your lender’s net income requirements and can supply your previous two years’ worth of tax returns, you can apply for the same commercial car finance product that any other small or large business can.

Can I add a trailer or equipment to my business car loan?

Yes – many lenders allow you to bundle a trailer or other business equipment with your vehicle finance. Whether you opt for a chattel mortgage or a leasing option, you may be able to include multiple assets under the same loan. This can save you from applying for finance separately and is especially useful if you expect your business needs to grow. For larger or more specialised purchases, you might also consider asset finance options, which are tailored for a wider range of business tools and machinery.

Am I able to buy more than one vehicle for my business?

Yes most types of business car finance can be used to fund multiple vehicles, whether you need one extra car or are building a fleet. Options like chattel mortgages, hire purchase agreements, finance leases and operating leases can all be structured to suit multi-vehicle purchases.

How do I qualify for business car finance?

Each lender or lease company will have different assessment criteria for their applications. However, you can expect the following general points to apply:

  • You must be at least 18 years of age
  • You must be an Australian citizen or permanent resident
  • You must have an active ABN or ACN and GST registration and have been running your business for at least 12 to 24 months (solutions may be available for businesses who don’t meet this requirement)
  • You must meet any minimum personal or business credit requirements
  • You must submit any documentation requested by your lender
What documents are required for business car finance?

The specific documents you’ll need can vary between lenders or leasing companies. However, you’ll typically be asked to provide some or all of the following:

  • Proof of identification (e.g. driver’s licence, passport)
  • Your ABN or ACN registration details
  • Business tax returns from the past one to two years
  • Up to six months of business bank statements
  • Recent Business Activity Statements (BAS)
  • Details of business assets and liabilities
  • A trust deed (if your business operates through a trust)
Can I still get business car finance if I don’t have all the required documents?

Yes – if you’re a sole trader, freelancer or small business owner with an ABN, you may qualify for an ABN car loan. These loans work similarly to a chattel mortgage but offer a way to finance a business vehicle with less documentation. 

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