How does equipment finance work for WA businesses?
Equipment finance lets your business get the gear working now and pay for it from the income it generates. And the timing matters: the $20,000 instant asset write-off became permanent law in August 2026, which changes how smart operators structure purchases above and below that line. Here is how it all fits together.
Short answer: equipment finance is one of the most useful growth tools a business has. Almost every business we work with hits the same moment: the work is there, but the gear is the bottleneck. The second ute, the bigger excavator, the extra oven. Equipment finance exists for exactly that moment. The gear starts earning now, the repayments come out of what it earns, and your working capital stays in the business doing everything else a growing business needs it for. Simple idea, several structures, and in WA right now there is a genuinely good reason to understand it properly. In August 2026 the $20,000 instant asset write-off finally became permanent law after a decade of year-to-year extensions. That changes how smart operators plan purchases on both sides of the $20,000 line. Equipment finance is the tool that makes the plan work. Here is the whole picture.
How does equipment finance actually work?
Short answer: the lender funds the equipment and the equipment itself commonly secures the loan. Your business repays over a term that matches the gear’s working life. The most common structure is a chattel mortgage: you own the asset from day one and the lender holds security over it. Interest and depreciation are commonly deductible for business use.
The main equipment finance structures
| Structure | Who owns the gear | Commonly suits |
|---|---|---|
| Chattel mortgage | You, from day one; the lender holds security over it. | Businesses that want ownership, the write-off and pool deductions, and interest deductibility. The most common pick. |
| Finance lease | The financier owns it; you pay to use it, with options at the end. | Businesses that want the gear without the balance sheet, or that upgrade often. |
| Rental / rent-to-own | The financier, with flexible return, upgrade or buy paths. | Fast-changing equipment needs and shorter commitments. |
Because the asset secures the loan, equipment finance is commonly easier to obtain than an unsecured business loan for the same amount. Terms usually run two to seven years to match the equipment’s life. Structures vary. There is the chattel mortgage where you own it outright, lease and rental structures where the financier owns it and you pay to use it, and rent-to-own hybrids. Which one suits depends on your cash flow, your tax position and how long you will keep the gear. The tax side of that choice is one for your accountant.
What changed with the $20,000 instant asset write-off?
Short answer: it stopped being a countdown. On 19 August 2026 the legislation passed. The $20,000 write-off is permanent from 1 July 2026 for businesses with aggregated turnover under $10 million. It applies per asset. Multiple eligible purchases under $20,000 can each be deducted in full in the year they are first used.
For a decade the write-off was extended one budget at a time. Businesses rushed June purchases to beat deadlines that kept moving. That era is over. The Treasurer put it at all 2.7 million active small businesses with turnover under $10 million standing to benefit, and the same bill brought back loss carry-back for companies, another cash flow support for growing businesses. The mechanics are set out in Treasury’s second reading speech.
The other side of the line matters just as much. Assets costing $20,000 or more go into the small business depreciation pool. That runs at 15 per cent in the first year and 30 per cent each year after. Most serious equipment sits well above $20,000: a ute, a truck, an excavator, a commercial kitchen. That is exactly where finance enters the conversation. None of this is tax advice. How the write-off and pool apply to your purchases is a conversation for your accountant. What we can tell you is how the finance side makes the plan workable.
How do equipment finance and the write-off work together?
Short answer: the write-off and pool deductions apply whether you pay cash or finance. Under a chattel mortgage you own the asset either way. So financing commonly lets you keep your working capital in the business and claim the deductions the purchase generates. Interest is commonly deductible on top for business use. Cash stays working, gear starts earning.
This is the part most owners have not been told. Paying cash for gear and financing gear commonly lead to the same asset deductions. Ownership is what matters, not how you paid. The difference is what happens to your cash. A business that drops $80,000 of working capital on a machine has a machine and no buffer. A business that finances it has the machine, the buffer, and repayments matched to the income the machine generates. That is how operators say yes to the bigger contract without starving the rest of the business. And in a market where lenders read your bank statements as the truth of your business, a healthy buffer is worth real borrowing power later.
The write-off finally stopped being a countdown. Your equipment plan can stop being one too.
What can you finance under equipment finance?
Short answer: almost anything that does work. Utes and trucks, trailers, excavators and yellow gear, workshop plant, agricultural machinery, commercial kitchens, medical and fitness equipment, IT hardware. New and used both finance, with lender appetite varying by asset type and age.
This is where WA businesses genuinely grow. Vehicles, earthmoving, mining services plant, farm machinery and trade equipment make up most of what we finance, and behind nearly every application is the same story: more work available than the current gear can handle. Used equipment is absolutely financeable. Asset age at the end of the term matters to lenders though, so older gear commonly means shorter terms. For subbies and operators whose paperwork is light, low doc paths exist too. It is the same territory we covered in truck finance without full financials.
What do lenders look for on an equipment finance application?
Short answer: the business and the asset, in that order. Trading history and account conduct show the repayments are serviceable. The asset’s type, age and resale story sets the lender’s comfort. Well-placed applications commonly come back within 24 to 48 hours, and clean files can be approved same day.
The reads are familiar if you have followed our business lending guides. Consistent revenue through the business account, clean conduct, existing commitments under control. The asset side is equipment finance’s own flavour. A near-new ute from a dealer is the easiest yes in the book. A fifteen-year-old specialised machine from a private sale needs the right lender. Placement, as always, is where outcomes move. The same operator and the same machine land differently across the panel, and knowing who suits what before applying is the whole job.
How do you get equipment finance from here?
Short answer: know what the gear needs to earn and get your accountant’s read on the write-off and structure. Keep your statements clean, then place the application with the lender whose appetite matches your business and your asset. One well-matched application, gear working within the week for clean files.
- Start with the earning case. What does the equipment generate, and what repayment does that comfortably cover? Lenders fund gear that pays for itself.
- Talk structure with your accountant. Chattel mortgage, lease or rental changes the tax picture, and the write-off and pool rules reward planning purchases deliberately.
- Keep the account telling its best story. Three clean months of trading through the business account is the strongest single input.
- Get the asset details right. Make, model, age, condition, seller. Dealer versus private sale changes lender appetite.
- Place it once, properly. The right lender for your file approves fast and the gear starts earning. That matching is what we do all day.
From the broker’s desk: equipment finance is some of the most satisfying work we do, because it is growth you can see. The machine lands, the extra crew starts, the bigger jobs get quoted. This is our bread and butter: small gear, big gear, a single work ute or a road train, workshop plant to a fleet of excavators, we place it all, week in and week out. Well-matched files commonly come back approved within 24 to 48 hours, and we know before we apply which lender suits which business and which asset. With the $20,000 threshold finally permanent, the planning conversation just got easier for everyone. Whatever the gear and whatever the size, reach out. We will look at it properly and tell you where it sits.
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Start with a chatThis guide is general information for the Australian market, not advice about your situation. Lender credit policy changes, and what applies to you depends on your circumstances. Pilbara Finance is a credit representative (478535) of Mortgage Specialists Pty Ltd, Australian Credit Licence 387025.