Chattel Mortgages easy repayments - The introduction of the GST in 2001 has seen a rise in popularity of the once 'less trendy' Chattel Mortgage finance facility

摘要

First it was the Tax Based Lease. Then it was the Commercial Hire Purchase. Now, switched-on tradespeople are opting for a Chattel Mortgage facility when making their motor vehicle, truck or plant and equipment asset purchases. Under a conventional Tax Based Lease or a Commercial Hire Purchase facility, ownership of the goods remains with the financier pending full payout of the corresponding loan contract, when title or ownership of the goods would then pass to the customer. Throughout the term of the loan contract (and depending on whether the customer has registered for GST under the Cash Accounting or Accrual Accounting methods), the GST component that is included in the price of the asset acquisition is amortised over the term of the loan contract and forms part of the designated monthly loan repayments. Effectively upon the completion of each BAS period, the customer can then only claim the GST component associated with their scheduled monthly loan repayment which has been incurred for that particular BAS period.