Chattel Mortgage Calculator

Looking to purchase a car for your business? Can you really afford a fleet? How much will monthly repayments be? Learn how a Chattel Mortgage Calculator can help you determine what type of vehicle you can afford for your business. What are the advantages of owning a car for your business? For a business, there are many benefits to owning a company car and building a fleet. For starters, owning a car outright means you keep the car for the long term. Businesses will also be able to claim the depreciation of the vehicle on their tax. What is a Chattel Mortgage? A Chattel Mortgage is essentially a standard mortgage against the vehicle and is available for businesses looking to purchase a car mainly for company use. The business itself will own the car from the time of purchase but the loan is still secured against the car, so in case of default, the financier can repossess the vehicle. This type of arrangement is different from a Commercial Hire Purchase where the financier maintains ownership of the vehicle until all payments have been made. Chattel Mortgages also have a number of benefits: - Flexible contract terms of 2-5 years - Optional deposit chattel mortgages can be used to finance the entire cost of the vehicle - Optional balloon payment at the end of the term - No GST to be paid on individual monthly payments in fact, youll be able to claim the GST in one lump sum on your next Business Activity Statement - Interest payments and depreciation are tax deductible How much will I have to pay? Monthly repayments will, of course, depend on the cost of the vehicle, the length of your term and the interest rate. Rates will vary from broker to broker, but you can get an estimate of the monthly repayments youll be making using a Chattel Mortgage Calculator. What are the tax implications of a Chattel Mortgage and who does it benefit? Specifically, a chattel mortgage is beneficial to companies that do business on a cash basis - that is businesses that account for their income and expenses when they are paid instead of at the time of invoice. Restaurants, retail shops, tradies - these cash based business will be able to declare all the GST on the purchase price as an Input Tax Credit on their next Business Activity Statement. Youll be much more likely to lower your tax debt upon reconciliation of your GST liabilities against your Input Tax Credits in that quarter, or even qualify for a refund. With other types of car finance, such as with a Commercial Hire Purchase, cash based businesses will have to claim their Input Tax Credits as each individual repayment is made over the course of the loan.

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