By the Loan Phone team Reviewed by Anthony Moncada, M.App.Fin, Cert IV Finance & Mortgage Broking
Quick Answer
Warehouse equipment finance allows Australian logistics and distribution businesses to acquire essential material handling equipment without depleting working capital. Rates typically range from 7-11% p.a. in 2025 (indicative only) for equipment including forklifts, pallet racking, conveyors, and warehouse management systems. Loan amounts from $10,000-$500,000+ over 1-5 year terms suit most warehouse operations. Modern comparison platforms can provide fast assessment, with settlements possible within days for straightforward applications (subject to lender and circumstances). Equipment serves as loan security, often allowing 100% financing including GST.
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Types of Warehouse Equipment Financed
Australian warehouse finance covers the full spectrum of material handling and storage equipment essential for logistics operations.
- Forklifts and lift trucks: Counterbalance forklifts, reach trucks, order pickers, and walkie stackers ranging from $15,000 for basic electric models to $80,000+ for heavy-duty diesel units. See our detailed forklift finance guide for specific forklift financing.
- Pallet racking and storage systems: Selective racking, drive-in racking, push-back systems, and mezzanine floors. Complete racking installations for medium-sized warehouses typically cost $50,000-$200,000, with larger distribution centres potentially exceeding $500,000.
- Conveyor systems: Belt conveyors, roller conveyors, sortation systems, and automated material handling equipment. These productivity investments often represent $100,000-$1M+ installations for automated warehouses.
- Warehouse management technology: Barcode scanners, RF terminals, warehouse management systems (WMS), and inventory tracking equipment. While individual items may cost $5,000-$20,000, complete system implementations can reach $50,000-$100,000+.
- Loading dock equipment: Dock levellers, dock shelters, vehicle restraints, and loading bay safety equipment essential for efficient goods transfer between vehicles and warehouses.
Financing Structures for Warehouse Equipment
- Chattel mortgage: Most common structure providing immediate ownership with competitive rates, typically 7-10% p.a. for established businesses. Allows depreciation claims on equipment while using it as loan security. Best suited for equipment intended for long-term use.
- Finance lease: Alternative structure where the lender owns equipment during the lease term. Monthly lease payments are fully deductible, though you cannot claim depreciation. Suitable for operations preferring to upgrade equipment regularly.
- Hire purchase: Gradual ownership structure with lower initial cash requirements. Ownership transfers after final payment, combining aspects of leasing with eventual ownership benefits.
Compare various equipment finance options to understand which structure best fits your operation.
Eligibility Requirements
Most lenders require standard business finance criteria:
- Trading history: Minimum 12 months for traditional lenders, though specialist providers may consider newer logistics businesses with strong contracts or experienced management.
- Financial documentation: Recent financial statements, BAS, and bank statements demonstrating capacity to service repayments alongside existing business commitments.
- ABN and GST registration: Current registration enables claiming GST input credits on equipment purchases, significantly improving cash flow for registered businesses.
- Equipment specifications: Clear supplier quotes showing equipment models, specifications, and pricing. Lenders prefer equipment with serial numbers and established resale markets.
Eligibility criteria may vary by industry—specialist logistics finance providers understand warehouse operations and seasonal patterns better than mainstream lenders.
Tax Considerations for Warehouse Equipment
Warehouse equipment typically qualifies for significant tax benefits under Australian tax law.
- Depreciation deductions: Forklifts and material handling equipment generally depreciate over 5-8 years, providing annual tax deductions. High-value equipment may qualify for instant asset write-off provisions (subject to eligibility thresholds and legislation).
- Interest deductibility: Interest portions of equipment loan repayments are typically tax-deductible as business expenses.
- GST claims: GST-registered businesses can claim input tax credits on equipment GST, improving initial cash flow by recovering the 10% GST component.
Important: Tax benefits depend entirely on your specific business structure and circumstances. This information does not constitute tax advice. Always seek independent advice from a qualified tax professional or accountant before making financing decisions.
Application Process
Applying for warehouse equipment finance follows standard business lending processes:
- Identify equipment needs and obtain detailed supplier quotes showing specifications and pricing
- Compare lender options using comparison platforms or specialist brokers familiar with logistics equipment
- Submit application with required financial documentation and equipment details
- Credit assessment typically completed within 24-48 hours for straightforward applications
- Documentation and settlement with funds paid directly to equipment suppliers
For related equipment financing, explore our guides on commercial equipment loans and manufacturing equipment finance.
Frequently Asked Questions
Can I finance used warehouse equipment? Yes, most lenders finance both new and used warehouse equipment. Used equipment older than 10 years may face restrictions or require higher deposits. Lenders assess condition, remaining useful life, and resale value when determining terms for used equipment.
What loan terms are typical for warehouse equipment? Forklifts and material handling equipment typically attract 3-5 year terms matching their useful life. Racking systems might extend to 5-7 years given their longer lifespan. Technology equipment often requires shorter 2-3 year terms to match technology refresh cycles.
Do I need a deposit? Many lenders offer 100% financing for warehouse equipment, requiring no upfront deposit. Some may request 10-20% deposits for used equipment, higher-risk applications, or specialist equipment. Providing a deposit typically improves rates and approval likelihood.
Speak with Specialists
Need expert guidance on your warehouse equipment finance application? Email: loans@loanphone.com.au Website: www.loanphone.com.au
Related Resources
Explore these related guides for business owners and ABN holders:
Disclaimer: This article provides general information only and should not be relied upon as financial or tax advice. Rates, terms, and eligibility vary by lender and individual circumstances. Tax benefits are subject to your specific business structure and circumstances. Always seek independent professional advice from a qualified accountant and financial adviser before making financing decisions.
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Last updated: 2025-11-09