Home Loans for Business Owners
Self-Employed Doesn't Mean Your Home Loan Has to Be Complicated
Running your own business can make your income look very different from the salary of a PAYG employee. You might pay yourself a wage, receive company profits or trust distributions, operate as a sole trader, or leave money in the business rather than drawing everything personally.
That doesn't automatically make you a difficult borrower. The challenge is that lenders don't all assess self-employed income in the same way.
One lender may rely heavily on your tax returns and financial statements. Another may have a streamlined pathway using more recent information. Some may also consider particular expenses or adjustments differently when working out the income available to service your home loan.
We help work out how your business income is actually generated, which documents are available and which lender assessment method may suit your circumstances before an application is submitted.
Assess My Self-Employed IncomeGeneral information only. Lending criteria and income verification requirements vary between lenders and are subject to credit assessment.
You may not always need two years of financials
Some lenders have one-year or streamlined assessment pathways for eligible self-employed borrowers.
Taxable income isn't always the whole story
Depending on lender policy, the assessment may consider business income, your ownership share and certain expenses or adjustments shown in the financials.
Business structure matters
A sole trader, partnership, company and trust can require different documents and a different approach to establishing usable income.
Understanding Your Income
Your Business Structure Can Change How Your Income Is Assessed
There isn't one universal calculation for a self-employed borrower. The starting point is understanding where your income comes from and how the business is structured.
Sole Trader
Your business income is generally closely connected with your individual tax position, but lenders may still need to understand business performance and liabilities.
Company
The assessment may need to consider your salary, ownership percentage, company profit, business liabilities and other income available to you.
Trust
Trust distributions alone may not tell the whole story. Lenders may need to understand the trust, beneficiaries, underlying business and your relationship to the income.
Partnership
The lender may need to establish your share of partnership income as well as the financial position and commitments of the business.
The figure on your personal tax return may not be the only figure that matters
Where lender policy permits, the assessment may need to look through the business structure to understand the income, expenses and profits attributable to you.
Lender Policy Matters
Why One Lender May Calculate Your Income Differently From Another
Two lenders can review the same business and arrive at different borrowing positions.
The difference can come down to how they assess the financial years available, changes in business income, your ownership share, business liabilities and particular expenses shown in the accounts.
Some lenders may have streamlined pathways for eligible business owners. Others may require a more traditional assessment using tax returns and financial statements.
This is why choosing the lender before understanding the financials can produce the wrong result. We prefer to assess the income first and then identify lenders whose policy fits the actual business.
Review My Business IncomeLenders may look at:
Your most recent business performance and the financial information available.
Salary, business profit, distributions and other income attributable to you.
Business debts, commitments and ongoing financial obligations.
Expenses in the accounts and whether lender policy allows any adjustments when calculating usable income.
Whether business income is stable, increasing, decreasing or materially different from previous periods.
Reading the Financials Properly
Could Your Usable Income Be Different From Your Taxable Profit?
Business owners legitimately incur expenses and make accounting and tax decisions that can affect reported profit. Depending on lender policy, some items may be treated differently when assessing home loan income.
Depreciation
Some lenders may make an adjustment for eligible non-cash depreciation expenses when assessing business income.
Interest & Finance Costs
Treatment can depend on the underlying debt, whether the commitment is included elsewhere and the lender's assessment methodology.
One-Off Expenses
A lender may consider whether an unusual expense is genuinely non-recurring and whether its policy permits an adjustment.
Other Business Adjustments
Depending on the accounts and lender policy, other items may need to be examined before usable income can be established.
An “add-back” is not automatic.
Whether an expense can be adjusted, and by how much, depends on the lender's policy and the nature of the expense. We review the financials rather than simply adding every deduction back to profit.
Different Ways to Verify Income
What If Your Latest Tax Returns Don't Tell the Current Story?
Not every self-employed application needs to follow exactly the same documentation pathway. What may be available depends on the lender, your business and the information available to support your income.
Pathway 1
Standard Financials
The lender assesses income using the tax returns, financial statements and other information required under its standard self-employed policy.
Pathway 2
Streamlined Assessment
Some lenders offer eligible business owners simplified or one-year assessment methods, subject to their specific eligibility and documentation requirements.
Pathway 3
Alternative Documentation
Where traditional financials are unavailable or don't fit the lender's standard requirements, some lenders may have alternative documentation pathways for eligible self-employed borrowers.
Alternative documentation isn't automatically better than a standard application. The right pathway depends on the documents you have, the strength of the application, the loan required and the lender options available.
Find My Income Assessment PathwayYour Business Isn't Always Straightforward
Situations That Can Make a Self-Employed Application More Complex
Complexity doesn't necessarily mean the application can't work. It means lender selection and the way the financial position is assessed become more important.
Your Latest Year Is Much Stronger
If business income has increased materially, lender treatment of the current and previous financial years can affect the outcome.
You Pay Yourself a Salary
Being paid a wage by your own company doesn't necessarily mean every lender will assess you as an ordinary PAYG employee. Your ownership and business position can still matter.
Income Flows Through a Trust
Trust structures can require a closer look at distributions, beneficiaries and the underlying source of the income.
You Have More Than One Business
Multiple entities can mean several income streams and liabilities need to be considered together rather than looking at one company in isolation.
You've Recently Become Self-Employed
A shorter trading history can reduce the number of available lender pathways, but requirements are not identical across the market.
Your Taxable Income Looks Low
The accounts may need to be examined properly to understand the business result, your share of income and any lender-permitted adjustments.
Be Prepared
What Documents Might You Need?
The exact documents depend on your business structure and the lender's assessment method. You may not need every document below.
Personal Tax Returns & Notices of Assessment
These may be used to establish your individual taxable income and verify lodged tax information, depending on the lender's requirements.
Business Tax Returns
These may be required depending on the business structure, your ownership and the lender's chosen assessment pathway.
Profit & Loss and Balance Sheet
Financial statements can help establish profitability, assets, liabilities and the overall financial position of the business.
Payslips or Income Statements
These may be relevant where you pay yourself a regular salary from your company and the selected lender has an eligible streamlined pathway.
BAS or Other Business Records
Depending on the lender and assessment method, more recent business information may be required to support the income position.
Business Liabilities
Details of business loans, vehicle finance, credit facilities and other commitments may need to be considered as part of the assessment.
Don't start collecting years of paperwork before we know which pathway may suit you. We can first understand your structure and then explain which documents are likely to be required.
Start My Free AssessmentWhy Work With Triple O Finance
Your Business Makes Sense to You. We Help Make It Make Sense to the Lender.
Self-employed lending is often less about finding a special “business owner home loan” and more about matching your income and documentation to a lender assessment method that fits your circumstances.
We Look Beyond One Number
We look at how your income is generated and the financial position behind it rather than assuming one taxable-income figure tells the whole story.
We Compare Assessment Methods
We compare lender policies and documentation pathways to identify options that fit the way your business income is evidenced.
We Structure Before We Submit
We identify potential income, documentation and policy issues before selecting the lender and lodging the application.
Self-Employed Home Loan Assessment
Find Out How a Lender May Assess Your Business Income
Tell us how your business is structured, how you earn your income and what you're looking to achieve. We can assess the available information and help you understand which lending pathways may be worth considering.
Get My Free Self-Employed AssessmentNo obligation. Start by understanding your options before choosing a lender.