Written by David Blackman
Specialist Asset & Equipment Finance Broker • 20+ years banking & fleet experience
AFG Award Winner 2022 & 2025
10+ Years Specialist Brokerage
Chattel mortgage, finance lease, operating lease, or novated lease? Understand the ownership, tax, GST, and cash-flow differences — then use our calculator to see real numbers for your asset.
| Feature | Chattel Mortgage (Commercial Goods Loan) | Finance Lease | Operating Lease | Novated Lease |
|---|---|---|---|---|
| Legal Ownership | You (borrower) from day 1 | Financier during term; you at the end | Financier (always) | Financier during term; residual purchase option |
| GST Treatment | Claim 100% upfront on BAS | Claim GST on each payment | Claim GST on each payment | GST saved via salary packaging (no BAS claim) |
| Depreciation | You claim depreciation (owner) | Financier depreciates | Financier depreciates | Handled by finance company |
| Interest / Rental Deduction | Interest is deductible | Entire rental payment deductible | Entire rental payment deductible | Pre-tax salary sacrifice reduces taxable income |
| Balloon / Residual | Optional (0–50%) | Mandatory (ATO minimum) | Built into the lease; no purchase option | Mandatory residual (ATO minimum); purchase option |
| Balance Sheet | Asset + liability on balance sheet | Off-balance sheet (AASB 16 may change this) | Off-balance sheet | N/A (personal arrangement via employer) |
| End of Term | Own outright (or pay balloon) | Pay residual to own; or refinance/trade | Return, extend, or upgrade | Pay residual, refinance, trade, or return |
| Instant Asset Write-Off | Eligible (as owner) | Not directly (financier claims) | Not directly | Not applicable (employee arrangement) |
| Best For | GST-registered businesses keeping the asset long-term | Cash-flow optimisation, medium-term assets | Short-term fleet, tech that depreciates fast | PAYG employees wanting tax-effective vehicle access |
| Typical Use Cases | Trucks, utes, earthmoving, farm equipment | Vehicles, equipment fleets | IT equipment, vehicles, fitouts | Cars, SUVs, EVs (via employer salary packaging) |
Enter your asset price, term, and rate — our calculator shows repayments and tax savings for all three structures.
Open Calculator →Full guide: how it works, who it suits, tax benefits, pros & cons, and worked examples.
Read Guide →Same product as chattel mortgage — here's why banks renamed it and what it means for you.
Read Guide →Full guide: how it works, residual obligations, tax treatment, and when to choose a lease.
Read Guide →Full guide: how it works, who it suits, fleet considerations, and true-cost analysis.
Read Guide →Full guide: salary sacrifice, FBT, EV exemption, costs bundled, and worked examples.
Read Guide →The two most popular structures compared: ownership, GST, depreciation, cash flow.
Compare →Own vs return at end of term: which lease type works for your assets?
Compare →Business vehicle vs salary sacrifice: which makes sense for your situation?
Compare →Complete side-by-side of chattel mortgage, finance lease, operating lease & novated lease.
Compare All →Take our 60-second quiz and get a personalised recommendation based on your GST status, asset type, and priorities.
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