Motor Vehicle Finance for Gig Workers – Affordable Loans Available

Motor vehicle finance for gig workers with little or no work-related financial details is available as ABN Car Loans through brokers and specialised lenders. Operating in the gig, task or part-time economy is increasingly popular. The number of individuals seeking additional income and options to full-time work continues to grow. The popularity of this sector of the economy is also driven by customer demand for delivery services and alternative transport options.

Individuals may choose this style of working as their main and sole source of income, as an extra stream of income, or as an addition to other part-time work. It can suit many individuals — mature and young workers, semi-retirees, students, and those re-entering the workforce.

To be eligible to participate with many providers in the gig economy, operators are required to hold an Australian Business Number (ABN) and, for many services, have a suitable vehicle. That can mean purchasing a suitable vehicle and for many, that can mean sourcing a car loan. That is the stage where many individuals may face obstacles – meeting the eligibility criteria for business financing.

Holding an ABN is an essential requirement for business vehicle loans. But lenders also require a range of financial records. Many lenders also require the operator to have been in business for at least 12, if not 24, months. Consequently, new workers looking to get into the sector may not meet the criteria for business loan approval. As specialists in car finance, we offer options for business entities and individuals that find themselves in this situation.

Motor Vehicle Finance for Gig Workers - Options

Individuals setting up as a business operation may apply for a business car loan as an ABN-only loan. Alternatively, they may apply for a Personal Car Loan where they have complete personal financial records. Buying the vehicle as a private vehicle and using it for business purposes may present a more easily attainable option to securing business finance with no docs for some individuals.

Business car loan interest rates are lower than personal car loan rates and tax deductions are available, which makes business finance more attractive. Tax deductions do not apply to personal car loan products. Individuals will need to check with an accountant on the ATO rulings for eligible tax-deductible expenses when using a private vehicle for business purposes. Extensive, detailed record-keeping may be required.

ABN Car Loan – Business Vehicle Finance

Individuals that do not meet all the criteria as required by some in the lending sector, can apply for an ABN Car Loan. This category of applicant can be eligible for business finance with an ABN, ID,  minimal or no financial records, and low turnover. This loan is in the same category as Low Docs and No Docs Car Loans.

Applications typically require the individual to provide their personal financial information. This would include personal income tax returns, previous or current payslips, bank statements, asset details and debts and liabilities. Personal credit scores are checked in lieu of a business credit history being available.

ABN Car Loans are not available through all lenders. We have access to specialist lenders that do offer this opportunity. Providing a potential workable channel for individuals to set up and start operating as self-employed. Your Jade broker will handle all lender contacts on your behalf. Sourcing the most suitable lender and the most affordable offer. 

Applicants can expect there may be conditions and limitations placed on any loan application approval. These may be a limit on the amount that can be borrowed, a higher rate than a business with full documentation would be offered, and extra collateral, in addition to the vehicle, may be required.

To be confident that finance has been secured before proceeding to commit to buying, individuals can apply for pre-approved finance. The application is processed and the loan quoted ahead of purchase. Providing the individual with confirmed information on how much they can borrow and what their repayments may be.

When the application is approved, the individual can choose which asset credit facility will best suit the structure of the entity. The choices include Lease, Chattel Mortgage and Commercial Hire Purchase. Consulting with an accountant on this decision is strongly advised.

Motor Vehicle Finance for Gig Workers – Tax Benefits

All business car loans offer tax deductions for vehicles to be used in a commercial operation, for business purposes. Lease provides tax-deductible payments, while Chattel Mortgage and CHP offer a deduction through vehicle depreciation.

When purchasing a vehicle with business finance and also using it for personal purposes, Fringe Benefits Tax (FBT) may apply. If a vehicle is financed with a personal loan and used for business purposes, individuals will need to consult an accountant on how the business would reimburse the individual for the mileage and running costs.

ABN Car Loans could be the opportunity you have been looking for, to enter the gig economy and generate an income stream. Speak with us about your options.

To discuss your eligibility and options for motor vehicle finance for gig workers connect with a Jade Finance broker online or by phone.

DISCLAIMER: NO LIABILITY IS ACCEPTED IF ERRORS OR MISREPRESENTATIONS ARE FOUND IN THIS ARTICLE. THE ARTICLE IS PREPARED AND PRESENTED FOR GENERAL INFORMATIVE PURPOSES AND IS NOT INTENDED TO BE THE SOLE SOURCE OF INFORMATION FOR MAKING FINANCIAL DECISIONS. THOSE REQUIRING GUIDANCE AND ADVICE SHOULD CONSULT A FINANCIAL ADVISOR.