Behind on BAS or Tax Returns? Here’s the Smartest Way to Finance Your Hospitality Equipment
Last updated: 23 April 2025
By Michael Pajar | Business Finance Broker | Casey Asset Finance
If You’re Behind on Tax Returns – You’re Not Alone.
Let’s be real: in hospitality, things get missed — and tax returns or BAS lodgements are often one of them.
Whether it’s late-night shifts, cash flow pressure, or ATO anxiety, many café and restaurant owners in Australia are currently behind on their financial reporting. And when that happens, getting finance for new equipment — like ovens, fridges, or fit-out upgrades — can feel like an uphill battle.
So… what options do you actually have if your tax returns aren’t up to date?
That’s what this guide is here to answer — clearly, without judgment, and in plain English.
What Happens If You Try to Get Equipment Finance While Behind on BAS or Tax Returns?
Many banks or lenders will:
Decline the application outright
Request multiple years of financials you don’t have ready
Flag your application for manual review
Delay the whole process (which means no oven, no fridge, no trade)
But here’s what they won’t tell you:
You can still get finance. You just need to choose the right type.
Chattel Mortgage vs Finance Lease: What’s the Difference When You’re Behind on Tax?
Option 1: Chattel Mortgage (Only works if you’re fully up to date)
How it works:
You own the asset from day one, and the lender secures the loan against it.
Why it can be good — if your books are in order:
You can claim the full GST upfront on the equipment
You may claim depreciation and interest on your tax return
You get full ownership straight away
Why it often doesn’t work for businesses behind on BAS or tax:
You can’t claim GST if you’re not lodging BAS
You can’t claim interest or depreciation if you haven’t lodged tax returns
Claiming things late can lead to ATO audit triggers or complications down the track
Summary:
A chattel mortgage is great when everything’s up to date — but it becomes risky and restrictive when your reporting isn’t current.
Option 2: Finance Lease (Much safer if you’re behind)
How it works:
You lease the equipment for a set term and may choose to buy it at the end.
Why it works better for businesses behind on compliance:
No big upfront GST — it’s spread across monthly payments
Your lease payments are tax-deductible operating expenses
You don’t need to lodge tax returns right now to claim deductions later
You avoid drawing unnecessary attention to a large GST claim or asset purchase
You stay off the ATO radar while still getting the equipment you need
Summary:
A finance lease is more flexible, ATO-safe, and better suited to businesses that are currently catching up on their books.
Real Talk: What I See Every Day in Hospitality
Many café and restaurant owners I work with:
Haven’t done their tax returns in 12–24 months
Haven’t lodged BAS in several quarters
Are avoiding their accountant due to ATO fear
Still need to replace an espresso machine, fridge, or grill this week
And the truth is — that’s okay. You’re not alone. And there are finance options built exactly for this kind of situation.
Real Example: Fit-Out Approved with No BAS on File
A cafe owner in Black Rock needed new commercial kitchen equipment and fit-out upgrades. They hadn’t lodged BAS in 9 months and owed a bit to the ATO in overdue BAS debt. They also hadn’t lodged their tax returns since FY22.
A chattel mortgage would’ve triggered red flags, so we arranged a low-doc finance lease approved in just under 48 hours — no financials, no bank statements, no questions.
Equipment was installed, plumbing and floors done, fit-out completed, doors stayed open, and the business is now slowly getting back on track.
The Smart Move If You’re Behind: Quick Comparison
Let’s simplify the choice if you’re behind on BAS or tax returns:
Chattel Mortgage – Only works if:
You’ve lodged your BAS
You’re on top of your tax returns
You want to own the asset right away
You’re ready to claim GST and depreciation correctly
Finance Lease – Better option if:
You haven’t lodged your BAS or tax returns yet
You need to avoid large GST claims and ATO scrutiny
You want fully deductible lease payments instead of asset ownership headaches
You need fast approval and low-doc options right now
Final Thoughts: You Deserve Options, Even If You’re Behind
You’re running a business. You’re trying to survive, pay staff, and keep the doors open.
If the ATO or tax returns are holding you back from upgrading your gear — you don’t need to wait. A finance lease could be your way forward.
Disclaimer
This article is for general informational purposes only and does not constitute financial or tax advice. Finance leases and chattel mortgages can have different outcomes depending on your business situation. We strongly encourage you to speak with your accountant or tax advisor before proceeding with any finance product.
Need Help Finding the Right Finance Option?
At Casey Asset Finance, we specialise in helping hospitality business owners across Australia access the right finance — even when things aren’t perfect on paper.
If you’re not up to date on BAS or tax but still need new equipment — let’s have a judgement-free chat.
We’ll walk you through your options, simplify the process, and help you move forward with confidence.
