What you need to apply for a car loan when you're self employed

Being self employed shouldn't stop you getting a car loan. Lenders just look at your income differently to a PAYG worker, so the paperwork is a little different. Here's what most lenders ask for, and how to make the process smoother.

How lenders look at self employed income

When you're on a wage, your payslips show a steady income. When you work for yourself, your income can change from month to month, so lenders want to see it over a longer period.

They'll usually look at how long you've held your ABN, whether you're registered for GST, and what your tax returns and business accounts show. Every lender sets its own criteria, which is why it helps to know which lenders suit the way you're paid before you apply.

The documents most lenders ask for

About you

• Photo ID, such as a driver licence or passport
• Your address and employment history
• Details of any existing debts, such as credit cards, personal loans or other finance
• Your regular living expenses

About your business

• Your ABN, and your GST registration if you have one
• Your most recent tax returns and notices of assessment
• Recent BAS statements
• Recent business bank statements

About the car

• The dealer invoice, or the private seller's details, the registration number and the VIN
• Details of any deposit or trade in

Your broker will confirm exactly what your lender needs, so you're not gathering paperwork you don't need.

What if your tax returns aren't up to date?

Some lenders offer low doc car loans for self employed people who can't provide full financials yet, for example because this year's tax return hasn't been lodged.

Instead of tax returns, a low doc lender may accept things like BAS statements, business bank statements, or a declaration from your accountant. Low doc loans can come with different rates, fees and conditions, and not everyone will qualify, so it's worth comparing the full cost before you decide.

What if you have a new ABN?

Many lenders prefer applicants who have held an ABN for a year or more. Some lenders consider newer ABNs, particularly if you've worked in the same industry before, have a deposit, or have a clean credit history. It depends on the lender and your overall situation.

Tips to make your application smoother

• Get your paperwork together early. Having your documents ready helps things move faster once you find the right car.
• Check your credit file. You can request a free copy of your credit report from the credit reporting bodies, so there are no surprises.
• Don't apply with lots of lenders at once. Each application can be recorded as an enquiry on your credit file. Talking to a broker first lets you compare options before anything is submitted.
• Be upfront about your situation. It's much easier to match you with the right lender when we know your whole situation.

How we can help

We work with self employed people and ABN holders every day, and we know which lenders consider different ways of showing your income. Read more about our car loans, or start a car loan quote. Enquiring with us has no impact on your credit score.