How Earthmoving Finance Works
Earthmoving equipment is among the most capital-intensive assets an Australian business can purchase. A 20-tonne excavator can cost $350,000+; a wheel loader $200,000-$500,000. Finance lets you put that equipment to work immediately while spreading the cost over years — often paid for by the revenue it generates on the first project.
Most lenders treat earthmoving equipment as self-securing: the machine itself is the collateral. This means you don't need to pledge property, and approval is faster than many other forms of business lending.
Equipment Types We Cover
- Excavators: Mini excavators (1.5–8t), mid-size (8–30t), and large (30t+) — Caterpillar, Komatsu, Hitachi, Kobelco, Volvo
- Wheel Loaders: Compact and full-size — Cat, Komatsu, Volvo, JCB, CASE
- Dozers: Track-type and wheel dozers — Cat D6/D8/D10, Komatsu D65/D155
- Graders: Motor graders — Cat 12M/14M, Komatsu GD655
- Skid Steers & CTLs: Bobcat, Cat, CASE, Kubota
- Rollers & Compactors: Bomag, Dynapac, Hamm, Cat
- Dump Trucks: Articulated and rigid — Cat, Volvo, Komatsu, Bell
- Attachments: Hammers, augers, buckets, thumbs, rippers — financed alongside or separately
Compare Finance for Your Next Machine
Chattel mortgage, finance lease, and operating lease — side by side with tax estimates.
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Finance Structures for Earthmoving Equipment
The high value and long useful life of earthmoving equipment makes structure selection critical. Here's how each option works:
| Feature | Chattel Mortgage | Finance Lease | Operating Lease |
|---|
| Ownership | Immediate | At end of term | Return to lessor |
| GST | Claim upfront | Claim monthly | Claim monthly |
| Depreciation | Yes (owner) | No | No |
| Interest Deductible | Yes | N/A (rental) | N/A (rental) |
| Balloon / Residual | Optional | Mandatory | Built-in |
| Best For | Owner-operators keeping long term | Project-based fleet | Short-term hire replacement |
Chattel Mortgage
The most popular structure for earthmoving. You own the machine from settlement, claim the GST upfront (saving ~$31,800 on a $350K excavator), and deduct both interest and depreciation. A 30% balloon at the end can reduce your weekly outgoings significantly.
Finance Lease
The financier retains ownership during the term. Each lease payment is tax-deductible. At the end, you pay the residual to take the machine — or upgrade. Common among civil contractors who cycle through equipment every 5–7 years.
Operating Lease
Essentially a long-term rental. You return the equipment at end of term — no residual risk. Keeps the asset off your balance sheet, which can help with bonding and government contract prequalification. Less common for earthmoving but useful for short projects.
Eligibility Requirements
- Active ABN — GST registered (almost universal for civil/earthmoving businesses)
- 12+ months trading history (start-up options available with additional guarantees)
- Clean credit — no current defaults or judgements
- Financials — BAS returns, tax returns, and/or financial statements for larger amounts
- Quote from dealer or private seller, including serial/VIN and hours
For used machinery, lenders will often require an independent valuation (especially 10+ year-old machines) and may cap the loan-to-value ratio at 70–80%.
Tax Benefits of Earthmoving Finance
- Instant Asset Write-Off: Eligible machines can be fully deducted in Year 1 under the current threshold — a huge benefit for large purchases
- Depreciation: Earthmoving equipment has effective lives of 10–15 years (ATO). Under chattel mortgage, you claim annual depreciation deductions
- Interest Deductions: All interest on a chattel mortgage is tax-deductible
- GST Input Credit: Claim ~$31,800 GST on a $350K machine on your next BAS
- Lease Deductions: Finance lease and operating lease payments are fully deductible business expenses
Tax benefits depend on individual circumstances and current ATO rules. Consult a qualified tax professional.
Calculate Your Earthmoving Tax Savings
Instant Year 1 deduction estimates for excavators, loaders, dozers and more.
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Earthmoving Finance FAQs
Can I finance a used excavator?▼
Yes. Lenders regularly finance used earthmoving equipment. The machine will need to have a reasonable remaining useful life (typically maximum 15-20 years old at end of term) and may require an independent valuation.
What deposit is required?▼
For established businesses with good credit, 100% finance is often available. A 10-20% deposit will secure better rates and terms. Trade-ins count toward the deposit.
Can I finance attachments separately?▼
Yes — attachments like hammers, augers, buckets, and rippers can be financed on their own agreement or bundled with the base machine. Bundling is usually simpler and may offer a better rate.
How does project-based finance work?▼
Some lenders offer seasonal or project-based repayment structures where you pay more during busy months and less during quiet periods. This can be arranged through a specialist broker.
Is refinancing existing equipment possible?▼
Yes. If you own equipment outright, you can use it as security to release cash (a "sale and leaseback" or chattel mortgage refinance). This is common for freeing up capital for new projects.