Quick answer
Equipment finance funds vehicles, machinery, technology and fit-out items, using the equipment itself as security. Because the lender's protection is the asset, it often needs less paperwork than an unsecured loan, and a supplier quote or tax invoice speeds it up. As a general guide it can settle within days. It spreads the cost over the asset's working life instead of paying cash up front.
Key points
- Secured on the equipment itself, so property isn't usually needed.
- A supplier quote or tax invoice is the key document.
- Spreads cost over the asset's working life.
- For 2025–26, the ATO's instant asset write-off threshold is $20,000 for eligible small businesses.
- Secured on
- The asset
- Covers
- Vehicles, plant, tech, fit-out
- Key document
- Supplier quote / tax invoice
- Speed
- Days (general market guide)
Why finance equipment instead of paying cash?
Cash spent on a machine is cash that can’t pay wages, buy stock or cover a tax bill. Equipment finance keeps your working capital where it’s most useful — in the business — and lets the asset pay for itself over the years it’s earning.
It’s also usually one of the more straightforward capital sources to arrange. The lender’s main protection is the equipment. If it has a clear value and a resale market, much of the risk is covered before the lender even looks at your bank statements.
How fast does equipment finance land?
As a general market guide, equipment finance often settles within days. The timeline is driven by:
| Factor | Speeds it up | Slows it down |
|---|---|---|
| Supplier | Dealer with tax invoice ready | Private seller, paperwork missing |
| Asset | Standard vehicle or machine | Specialised, custom or imported gear |
| Business | 2+ years trading, clear statements | New ABN, unexplained gaps |
| Amount | Modest relative to turnover | Large relative to the business |
If you need equipment working by Monday and finance won’t settle in time, a short-term caveat loan over property can bridge — $20k to $250k is possible the same day — with the equipment refinanced onto a proper facility afterwards.
What types of equipment finance are there?
- Chattel mortgage — you own the asset from day one; the lender takes security over it. Common for vehicles and machinery.
- Finance lease — the lender owns the asset and leases it to you, often with a residual at the end.
- Operating lease or rental — you use the asset without owning it; suited to gear that dates quickly, like IT.
- Hire purchase — you pay instalments and take ownership after the final payment.
The tax and GST treatment differs between them. Your accountant is the right person to say which suits your structure.
How does the instant asset write-off affect timing?
The ATO has confirmed a $20,000 instant asset write-off threshold for 2025–26 for eligible small businesses. Eligible assets costing less than $20,000 that are first used or installed ready for use in the income year may be immediately deductible.
Two practical points for planning:
- What matters is when the asset is first used or installed ready for use, not when you sign the finance documents.
- Financing an asset doesn’t by itself stop you claiming — but get advice on your specific purchase.
Our guide to instant asset write-off timing in 2026 goes into this in more detail.
Can I finance used or private-sale equipment?
Often, yes. Lenders will want to confirm:
- the asset exists and matches its description (photos, serial numbers, inspection)
- there’s no finance already registered over it — checked on the PPSR
- the price is reasonable for its age and condition
A buyer who runs a PPSR search before paying a private seller protects themselves from inheriting someone else’s debt.
An illustrative example
A small earthmoving business wins a council contract and needs a second excavator within two weeks. The dealer has a suitable used machine with a tax invoice ready. Equipment finance secured on the excavator lets the business pay the dealer, start the contract and repay from the contract income over several years — while its cash reserve stays intact for fuel, wages and the first month before progress payments start. (Illustrative only.)
If you’ve got a quote in hand right now, start your enquiry and attach the timing.
When is equipment finance the wrong tool?
- Short-lived items — consumables and small tools are usually better paid from cash flow
- Assets with little resale value — custom fit-outs may need fit-out funding instead
- When the real problem is cash flow — buying equipment won’t fix a working capital gap; a working capital loan might
Balloon payments and residuals
Many equipment finance agreements include a balloon or residual — a lump sum due at the end of the term. A balloon lowers the regular repayments, but you’ll need to pay, refinance or trade in the asset at the end. Questions to ask:
- What’s the balloon in dollars, and when is it due?
- Will the asset be worth at least that much at the end?
- Can the balloon be refinanced if needed?
Balloons can be useful for assets that hold their value, like quality trucks and machinery. For assets that date quickly, a smaller or no balloon is often safer.
Equipment finance by industry
| Industry | Common assets financed |
|---|---|
| Construction and earthmoving | Excavators, loaders, trucks, trailers |
| Transport and logistics | Prime movers, vans, forklifts |
| Hospitality | Commercial kitchens, coffee machines, refrigeration |
| Medical and dental | Chairs, imaging, sterilisation equipment |
| Manufacturing | CNC machines, presses, packaging lines |
| Agriculture | Tractors, harvesters, irrigation |
| Professional services | IT, fit-out items, vehicles |
Tax invoices and GST
The supplier’s tax invoice is central to equipment finance — it confirms the asset, price and GST. If you’re registered for GST, the GST on an asset purchase may be claimable, depending on the finance structure and your circumstances. Your accountant can confirm how it applies.
Got a quote and a deadline?
Equipment that earns money should start earning as soon as possible. Asking what’s available doesn’t involve a credit check, and your details won’t be sent off to a dozen financiers — a real person reads your enquiry and works out the quickest sensible path. Share accurate details on the asset, the price and your timing so we can move straight to the right option. See if your business qualifies.
Frequently asked questions
What equipment can be financed?
Most business assets with a resale value: vehicles, trucks and trailers, earthmoving and agricultural machinery, manufacturing equipment, medical and dental gear, IT and hospitality equipment. Used equipment can often be financed too.
Do I need a deposit for equipment finance?
Not always. Some lenders fund the full purchase price for established businesses; others want a deposit, especially for newer businesses or specialised equipment.
How fast can equipment finance settle?
As a general market guide, often within days once the supplier invoice and your documents are in. Private sales and specialised gear can take longer while the asset is verified.
Can I claim the instant asset write-off if I finance equipment?
The ATO's instant asset write-off depends on eligibility, cost and when the asset is first used or installed ready for use, not on whether you paid cash. Confirm your position with your accountant.
What if the equipment is second-hand from a private seller?
Many lenders will fund private sales, but they'll want to verify the asset, its condition and that there's no existing finance owing on it — usually through a PPSR search.