Accessing business finance doesn’t have to be hard work
26 June 2019|4 minute read
Investing in new vehicles, plant and equipment can be the key to business growth. The downside is that organising finance can be challenging when you go it alone.
To begin with, there is no guarantee your regular bank will come to the party. Research shows that one in four small and medium enterprises (SMEs) have been knocked back for finance by their regular bank. Among those that do get the green light, 29% of SMEs say their business was negatively impacted by the time taken to arrange funding.
A time-efficient solution is to speak with your Aussie Broker about asset finance.
Aussie Brokers can help with more than just home loans. Aussie Asset Finance has access to over 30 lenders, giving your business the benefit of choice. Your Aussie Broker will do all the running around, managing the finance process with the lender that’s right for you including sourcing documentation, credit approval and pricing. It leaves you free to stay focused onrunning your business.
The thing is, Aussie Asset Finance is more than just a time saver. As a lending expert (and fellow small business owner) your Aussie Broker may be able to suggest funding structures for your new business asset that you may not have considered.
Mike Briggs* runs a successful panel beating workshop. With business booming, he was looking to add an additional spray booth at a cost of around $150,000.
Like a lot of business owners, Mike initially planned to refinance the family home as a way of purchasing the equipment. Sensibly, Mike spoke with his Aussie Broker first – the same broker who had organised his home loan. It was a smart move because it turned out that another finance strategy was available that better suited Mike’s needs.
Mike’s Aussie Broker explained that asset finance offered plenty of advantages compared to extending his home loan. The finance costs would be fully tax deductible, a loan term could be selected that better matched the life of the equipment, and Mike would be able to draw a clear line between business assets and his personal assets.
With his Aussie Broker’s help, Mike was able to fund the spray booth using a chattel mortgage. And as his broker managed the entire process, Mike was free to concentrate on growing hisbusiness while finance was being sorted. To cap it off, the new asset didn’t leave a single dent in the family’s home equity.
No matter which industry your business is part of, investing in vehicle, plant and equipment can improve productivity or help your business grow through new products or services. Thanks to the Government’s instant asset write-off, buying new business assets can also deliver valuable tax savings that support cash flow.
The 2019/20 Federal Budget saw the instant asset write-off extended until 30 June 2020, and given an uptick from $25,000 to $30,000. Already, more than 350,000 businesses have taken advantage of the instant asset write-off. Over three million SMEs are eligible for the claim – your business could be one of them.
That makes it worth talking to your Aussie Broker about asset finance options that can drive your business forward – and potentially enjoy a valuable tax break.
*Customer details changed to protect privacy.