The Finance Algorithm

Chattel Mortgage Calculator

Calculate business vehicle finance repayments, the GST credit and the tax deductions on a chattel mortgage

Updated October 2026Built and checked by MaverickHow it's calculatedReport an error

Your numbers

Updates as you type
$
$55k

The ATO's car limit caps the GST credit and depreciation on cars, not on vehicles that carry a tonne or more or nine or more people

$
$5k
%
7%

The rate on your finance quote

5
%
30%

Lump sum due at the end, as a share of the vehicle price

%
80%

The share of use that's for business, for example from a logbook. GST credits and deductions are limited to this share

%
25%

25% for a base rate entity company, 30% for other companies, or your marginal rate as a sole trader (0%, 15%, 30%, 37% or 45% in 2026-27, plus the 2% Medicare levy)

Small businesses (turnover under $10 million) can write off assets under $20,000 or pool them at 15% then 30%. Otherwise a car's 8-year effective life gives 25% a year

The button asks our AI to explain these figures in words.

Chattel mortgage: business vehicle finance

Monthly repayment

$760

balloon: $16,500

GST credit

$4,000

business share of the GST

Tax savings

$10,533

interest + decline in value, over the term

After-tax outlay

$52,542

deposit + repayments + balloon, less GST credit and tax saved

Business share of interest + decline in value

Depreciation is worked out on $51,000: the price, less the GST credit. Year 1 is counted as a full year.

$8,773Year 1$12,722Year 2$9,241Year 3$6,670Year 4$4,728Year 5

What you pay over the term

Deposit + principal + interest + balloon, before the GST credit and tax deductions.

$67,075gross cost
Deposit7.5%
Principal49.9%
Interest18.0%
Balloon24.6%
Business use
Records back up the business-use percentage
A sole trader or partnership using the logbook method keeps a logbook for at least 12 continuous weeks, and it stays valid for five years. A company or trust that lets an employee or director use the vehicle privately works through fringe benefits tax instead.

How it works

A chattel mortgage is a business loan where you own the vehicle from the start and the lender holds a mortgage over it until the loan is repaid. Because the business buys the vehicle outright, a GST-registered business can claim the GST credit in the BAS for the period it buys the vehicle, even on a cash basis, and deduct the business share of the interest and the vehicle's decline in value. This calculator works out the repayments, the GST credit (capped for cars at one-eleventh of the 2026-27 car limit of $69,883, which is $6,353), and the interest and depreciation deductions over the loan term under the ATO's small business or diminishing value rules.

  1. 1Enter the vehicle price including GST, and whether it's a car or a vehicle that carries a tonne or more.
  2. 2Add any deposit, the rate and term, and a balloon if the loan has one.
  3. 3Enter the business-use percentage and your tax rate.
  4. 4Choose small business simplified depreciation or diminishing value.
  5. 5See the GST credit, deductions by year and the after-tax outlay.

The figures today

As of 7 November 2026, the lowest car loan rate from a bank or lender is 5.74%, from Westpac's Car Loan, while the typical best across 42 institutions is 6.99%. The lowest carmaker finance rate is 2.70%, from Chery Motor Finance's Chery 4.46% EV Comparison Rate Offer, while the typical best across 12 institutions is 4.99%.

Car loan rates

Worked examples

Ute for a Tradie

A $55,000 ute (inc GST) that carries over a tonne, with a $5,000 deposit and no balloon, 7% over 5 years, 80% business use, 25% company tax rate, small business depreciation.

Vehicle price (inc GST)
$55,000
Deposit
$5,000
Interest rate
7%
Loan term (years)
5
Balloon/residual
0%
Business use
80%
Company/marginal tax rate
25%

Monthly repayment: $990. GST credit: $4,000 (80% of the $5,000 GST). Over 5 years the business deducts $7,523 of interest and $32,473 of decline in value (the $51,000 cost after the GST credit, pooled at 15% then 30%), saving $9,999 in tax.

Questions people ask

Who uses a chattel mortgage?
Businesses, including sole traders, that buy a vehicle used at least partly for the business. The GST credit and deductions are limited to the business-use share, so the higher that share, the larger the tax effect.
What's the difference between chattel mortgage and car loan?
Both are loans secured by the vehicle. A chattel mortgage is taken out by a business for a business vehicle, so the business can claim the GST credit and deduct the business share of interest and decline in value. A personal car loan for a private car has no GST credit or deductions.
Do I pay FBT on a chattel mortgage?
Sole traders and partners don't pay FBT on their own use; they claim only the business share of the costs. A company or trust that makes a car available for an employee's or director's private use may have a car fringe benefit to pay FBT on.

The terms, in plain English

Chattel Mortgage
A business loan where you own the vehicle from the start and the lender holds a mortgage over it as security.
GST Credit
The GST in a business purchase that a GST-registered business claims back, limited to the business-use share and, for cars, to one-eleventh of the car limit.
Car Limit
The most of a car's cost that can be depreciated ($69,883 for cars first used in 2026-27). It also caps the GST credit on a car.
Instant Asset Write-Off
An immediate deduction for small businesses (turnover under $10 million) on assets costing less than $20,000, made permanent from 1 July 2026.
Logbook Method
A record of business and private trips over at least 12 continuous weeks, used to work out the business-use percentage. It's valid for five years.

Official sources

Novated Lease Calculator

Alternative for employee vehicles

Car Loan Calculator

Standard personal car loan

Balloon Payment Calculator

Understanding balloon options