Calculator · Central Lending Solutions
Leasing Calculator
A lease payment is the periodic amount you pay to use a vehicle, ute or piece of equipment over a fixed term, worked out from the asset value, the lease rate, the term and the residual buy-out at the end. Enter your numbers below to see an indicative weekly or monthly figure for your Perth business, then check the lease versus buy call with a broker.
Why this matters
What this calculator is actually telling you.
The calculator models the periodic payment a financier would charge to put a vehicle, ute, trailer or piece of plant in your name over a set term. It takes the asset value, an indicative lease rate, the lease term and the residual value at the end, then returns the weekly, fortnightly or monthly cost so you can sanity-check whether a lease fits the cash-flow profile of your Perth construction, mining services or trades business.
Residual value is the lump sum the financier expects the asset to be worth at the end of the term. A higher residual lowers your periodic payment because you are only financing the difference between the asset price and the residual, not the full asset. The ATO publishes minimum residuals by term length, which is why a 5-year lease on a $70,000 ute typically lands on a 28.13% residual rather than a number the financier picked.
The lease versus buy call usually comes down to tax treatment and balance sheet effect. On an operating lease the full rental is treated as a 100% deductible operating expense, with no asset and no depreciation on your books. On an asset purchase or chattel mortgage you own the asset, claim depreciation under the ATO rules and deduct the interest portion of the repayment. For a sole-trader Perth tradie on the instant asset write-off thresholds, buying outright often wins. For a growing fleet that wants to keep working capital free and rotate utes every 3 to 5 years, leasing usually wins.
This calculator is the starting point, not the answer. The right structure depends on your GST position, your accountant's view on depreciation versus expense, your projected use of the asset and whether the asset is plant, a motor vehicle or a passenger car subject to the luxury car limit. The CLS commercial lending team works the lease, chattel mortgage and novated lease options across more than 30 lenders so the structure matches the business, not the other way round. Always confirm the tax treatment with your accountant. For current ATO guidance on lease versus purchase deductions, see ato.gov.au.
Questions
Frequently asked.
How is a lease payment calculated?
A lease payment is worked out from the asset value, the lease rate, the lease term and the residual value at the end of the term. The financier is only financing the difference between the asset price and the residual, plus a finance charge, spread across the term. A higher residual lowers the periodic payment but leaves a larger lump sum to pay or refinance at the end.
Should I lease or buy a work vehicle or equipment in Perth?
It depends on your tax position and how you use the asset. Buying outright or via a chattel mortgage lets you claim depreciation and the interest portion of the repayment, and may suit a sole-trader Perth tradie using the instant asset write-off. Leasing keeps working capital free, treats the rental as a 100% deductible operating expense and suits growing fleets that rotate utes or plant every 3 to 5 years. Talk to your accountant and a CLS broker before committing.
What is residual value on a lease?
Residual value is the agreed lump sum owing at the end of the lease, set as a percentage of the asset value. The ATO publishes minimum residuals by term length to stop financiers artificially lowering monthly payments. At the end of the term you typically pay the residual to take ownership, refinance it, or hand the asset back if the lease allows.
What is the difference between an operating lease and a finance lease?
An operating lease is closer to a long-term rental. The financier owns the asset, the rental is a 100% deductible operating expense and the asset does not sit on your balance sheet. A finance lease is closer to ownership. You take on most of the risk and reward of the asset, the asset and lease liability sit on the balance sheet, and you typically take ownership at the end via the residual. The right choice depends on your accounting treatment, GST position and how long you plan to keep the asset.
Is leasing better than a chattel mortgage for Perth tradies?
Not automatically. A chattel mortgage means you own the ute, plant or trailer from day one, claim depreciation and the interest portion of the repayment, and the GST on the asset is claimable upfront. That often wins for a Perth tradie on the instant asset write-off. A lease can win when cash flow matters more than ownership, when the asset will be replaced inside 5 years, or when the business wants the simpler 100% deductible expense treatment. The right answer is structure-by-structure, not a blanket rule.
Where do I go for help structuring a lease or chattel mortgage in Perth?
Call Central Lending Solutions on 0489 082 257 or book a free chat. The commercial lending team will run the lease, chattel mortgage and novated options across more than 30 lenders, then work alongside your accountant to confirm the tax treatment makes sense for your business. Established 2015, MFAA member, ACL 497 950.
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