A Chattel Mortgage Agreement (CM) can provide your business with an alternative method of funding for vehicle and or plant & equipment acquisitions that is designed to optimise cash flow, while minimising the impact of GST.

The CM enables you to purchase the goods you need and acquire immediate ownership of the asset so that you can get on with your day to day business, without significant impact on your working capital.

Key Features of the Chattel Mortgage are:

• Vehicle/equipment is available for immediate use in the business with no capital outlay; use the CM to purchase assets being used to generate income in your business.

• Enables you to spread the cost of acquisition over the useful life of the vehicle/equipment as it generates income.

• You acquire immediate ownership of the asset.

• You retain all the equity in the vehicle/equipment.

• Depreciation and interest are usually tax deductible.

• No GST is payable on individual instalments; you claim a direct input tax credit (ITC) on the invoice price.

• Use the vehicle/equipment as security – in most cases freehold property can be left for other funding requirement. Added flexibility of including other equipment under the one contract is available if required.

• Fixed interest rate for the term of the contract, which enables you to avoid market interest rate increases and assists you with budgeting.

• You control the purchase process; you choose the supplier and negotiate the price independently; financier then pays your supplier.