How does a chattel mortgage change the GST timing on a tractor?
On a chattel mortgage you claim the GST credit on the machine in the BAS period covering the tax invoice, so a quarterly lodger sees the cash in the following quarter, not on settlement day. On a finance lease you claim the GST as each payment is made.
How do you use this in your decision?
Put your own quote, loan terms and lease terms into the sheet on the home page. It shows the three options in today dollars, the deduction timing year by year, the GST credit quarter and the machine's value at the end, then names the cheapest on your figures and by how much. Every rate, residual and effective life is labelled an assumption for your accountant.
Which rules sit behind the tax treatment?
The tax treatment of the decision is the work of a registered tax agent. See the rules that apply to you for the held obligations under the Tax Agent Services Act 2009 (Cth), cited to their clauses.
Frequently asked questions
Why does the GST credit timing matter so much?
Because the credit can land a quarter after you have paid the dealer. The sheet shows the GST credit in the quarter it is claimed, not as cash on settlement day, so the lean-month gap between paying for the machine and receiving the credit stays visible in the comparison.
Does the sheet decide the GST treatment for me?
No. It applies the credit timing that belongs to each structure and shows the quarter it lands in. Your accountant confirms the treatment on your own registration and reporting cycle.
Related answers
- Does my tractor go to the small business pool or the instant asset write-off?
- What is the residual on a farm machinery lease, and who pays it?
- Is leasing or buying a tractor cheaper in today dollars?