Lease finance is often also referred to as Asset finance, Equipment finance or simply leasing.

There are four main products used for lease finance

• Hire Purchase - the customer hires the equipment until they make the final payment, at which time ownership transfers into the client's name. interest and depreciation are usually tax deductible.
• Chattel Mortgage - the customer owns the asset from the start. The lender takes a charge over the asset. Interest and depreciation are usually tax deductible.
• Finance Lease - the asset is owned by the lender. The client is basically leasing it from the lender and does not take ownership. Rental payments are tax deductible, but not depreciation as the asset is not owned, but leased.
• Novated Lease - the asset is owned by the lender. Rental payments are made by the employer. Rental payments are usually tax deductible.

TYPE	OWNER STATUS	SECURITY	BENEFITS	NOTES
Commercial Hire Purchase (CHP)	The financier is the "owner" whilst the client is the "hirer"	Secured by the vehicle or asset, upon receipt of the final payment ownership of vehicle tranfers to the client.	Interest component of loan repayments and depreciation are tax deductible.(Deposits or trade in equity can be applied)	When you want to upgrade the vehicle or asset it can help to avoid capital gains tax liability.
Chattel Mortgage	The client is the owner of the goods	Secured by the asset, where the financier takes a mortgage over the asset.	Key difference between this and CHP is the ownership of the asset. Best for businesses using the 'cash' method of accounting for GST.	If you are on 'cash' method of accounting you can obtain full tax credit for any GST paid relating to the purchase of the asset.
Escrow	Provides interim finance to allow progress payments on assets being constructed or installed	Same as CHP	Allows the funder to establish a line of credit which can enable the goods to be imported	Referred to as Import finance or Progress payments
Leasing	Financier is the owner of the good. .	Lease is secured by the asset, which is held in the name of the financier	No down payments, the flexibility of returning the equipment,  Lease payments are fully tax deductible

With all of the above products the term is normally limited to 5 years.

If you would like to discuss your lease finance requirements you can:

1. Call us during business hours on (03) 9700 7033.  
2. Make an appointment or Submit an enquiry .