Since we have commenced our finance operation we have written a large amount of finance for vehicles and machinery. In both instances we would like to take this opportunity to share six helpful facts with you for when you look to finance your next purchase in this area.



1. The legislation in regards to tax benefits, including Fringe Benefits Tax, is constantly changing and will impact upon the affordability and tax savings associated with your purchase. As professionals in this area we will be able to assist you to insure you gain every tax benefit possible from the transaction and across the life of the finance agreement.

2. Always structure your finance arrangements so that you gain full tax benefits associated with ownership of the goods. In previous years, companies sought to utilise lease
agreements such as Notated Leases, which do not enable the lessee to take advantage of full ownership. In these instances, the tax benefits of owning the goods remain with the financier.

3. In more recent times, Chattel Mortgages have become more useful as they allow for GST to be claimed back upon purchase, provided both the seller and buyer are GST registered. This form of finance also enables the buyer to take full advantage of the tax benefits associated with the ownership of the goods.

4. Always balance your repayments with your cash flow. Different instances may require different repayment periods to be structured into your finance agreement and this can be done where necessary.

5. In the instance of a "balloon repayment" at the end of your finance agreement, always insure that the goods can be sold for more than the outstanding amount. Having to
repay the difference upon the sale of the goods or the finish of the finance agreement can cause cash flow issues. We have some rules of thumb here that will assist in assuring you are adequately covered when it comes to selling your asset.

6. When it comes to getting the best rate always utilise the services of a broker. Vehicle, machinery and equipment finance are constantly changing in relation to rates and terms. In a market place with over 20 different lenders, it pays to check for the best rates and terms through a broker as these will change from month to month. In addition, brokers are aware of the best lender to place your loan, dependent upon your terms and your time frame.

In summary, there are a number of ways to insure your next vehicle or piece of machinery is purchased in the most beneficial matter to your business and personal situation. Your full financial situation would need to be reviewed prior to acceptance of any offer or product.

Prior to the purchase of your next vehicle, please contact Peter Flemming at out office directly on 07 3878 8889 or email peter.flemming@schuhgroup.com.au for assistance with the tax implications of your purchase, along with David Schuh by email david.schuh@schuhgroup.com.au or direct telephone 07 5480 4808 to provide you with an indicative quote.