How to Finance a Prestige or Classic Car Through Your Business

Financing a prestige or classic car through your business can offer significant tax benefits and help preserve personal finances. For ABN holders, using a business vehicle for personal and business purposes, including luxury and classic cars, is a viable option. However, it’s important to understand the different financing options available and how to structure the loan to maximise the benefits while staying compliant with tax laws.

One of the most popular ways to finance a business vehicle, including prestige or classic cars, is through a chattel mortgage. This option allows the business to borrow money to purchase the car, and the vehicle itself acts as collateral for the loan. The advantage of a chattel mortgage is that it allows for GST claims on the purchase price and ongoing expenses, which can help reduce the overall cost. Additionally, the car is treated as an asset of the business, potentially offering depreciation benefits.

Another option is hire purchase financing, where the business enters into an agreement to purchase the vehicle over time. Similar to a chattel mortgage, the car remains the property of the lender until the final payment is made. This option can be beneficial if your business prefers predictable repayments without needing to make a large upfront payment. However, it’s important to ensure that the car is used predominantly for business purposes to maintain compliance with tax rules.

Before committing to any loan, it’s crucial to compare interest rates, fees, and repayment structures across lenders. Working with a finance broker who understands the specific needs of businesses financing luxury or classic cars can help secure the best deal. With the right approach, ABN holders can finance their dream car while enjoying the financial and tax benefits of doing so through their business.

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