Equipment Finance with ATO Debt
Credit issues narrow the lender panel but rarely stop an approval — here's how Australian businesses fund business equipment with impaired credit.
Can I get finance if I owe the ATO money?
Yes — credit problems narrow your options but rarely close them. Equipment finance is asset-backed, so a lender's downside is covered by a machine it can recover and resell. That is why specialist and second-tier lenders will still look at Australian businesses with defaults, arrears, judgements, tax debt or a discharged bankruptcy where a bank would decline outright.
What matters most is the story behind the impairment. Lenders want to know what caused it, when it happened, whether it has been paid or settled, and what has changed since. A three-year-old telco default carries far less weight than a $40,000 unpaid commercial default from last quarter. Age of the event, whether it is paid, the total number of adverse listings, and current conduct on existing loans are the levers that decide the outcome.
Expect the trade-offs to be commercial rather than punitive: a deposit of 10–30 per cent, a rate premium over prime pricing, a shorter term, and sometimes a preference for standard, easily resold business equipment rather than specialised units. Property ownership, a payment arrangement in place for any ATO debt, and clean recent bank statements all pull the deal back towards mainstream pricing.
Because multiple declined applications leave marks on your credit file, the safest route is one broker who knows which lenders genuinely fund impaired credit. Lonix places the application with the right lender first time, and revisits pricing at refinance once conduct is re-established.
Related questions
- Will applying hurt my credit file?
- Every application leaves an enquiry. Going through one broker who knows the right lender avoids the damage of shopping around.
- Do defaults have to be paid first?
- Not always, but a paid or settled default is viewed far more favourably and usually improves both approval odds and pricing.
- How big a deposit will I need?
- Commonly 10–30% depending on the severity and age of the credit issue, the asset, and whether you own property.
- Can I refinance later at a better rate?
- Yes. After 12 months of clean conduct many borrowers refinance into mainstream pricing.