Every lender reads self-employed income differently: one year of returns or two, which add-backs count, how a company or trust is treated. Charles matches your figures to the lender that reads them best.
The lender whose policy fits your financials. Some lenders work from the most recent year, some accept one year of returns with two years of ABN registration, and each has its own list of add-backs for depreciation, one-off costs and super above the guarantee.
Full doc at standard rates is checked first; low doc on BAS or bank statements is the bridge for the first year or two in business, not the default.
Part of the employment and income home loans guide.
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Some accept one year of financials, some add back depreciation. Choice decides.
Two years full‑doc, one year, accountant declarations or BAS.
Sole traders, contractors, company directors and tradies.
Most self-employed borrowers are told low doc is the only option because the first lender they asked does nothing else. The same applies to newer ABN income such as rideshare and delivery driving.
| Full doc | Two or more years trading with tax returns lodged. Two years of personal and business tax returns and notices of assessment; sometimes BAS and financial statements. Standard rates, the same as a salaried borrower. The first question is whether a full doc lender will take your file as it stands, before accepting anything dearer. |
|---|---|
| Low doc | Trading under two years, or returns not yet lodged. Business activity statements, business bank statements or an accountant's declaration, depending on the lender. Usually higher, and a larger deposit is often required. A bridge for the first year or two in business, reviewed again once returns exist. |
| One-year financials | Returns lodged, but the latest year is well ahead of the one before. The most recent year's returns, often with year-to-date BAS. Close to standard with the right lender. Some lenders use the latest year alone instead of averaging two, which can change the borrowing figure substantially. |
Lender policies on self-employed income differ on add-backs, averaging and the number of years required, and change over time. Which option fits is confirmed in assessment, not assumed.
Charles Touma, Mortgage Broker.
Two years of tax returns and notices of assessment is the classic ask, but several lenders work from the most recent year and some accept one year of financials with two years of ABN registration.
Without lodged returns, low doc lenders read business activity statements, business bank statements or an accountant’s declaration, usually at a higher rate and with a larger deposit.
Depreciation, one-off expenses, super contributions above the guarantee and interest on debts being refinanced can all be added back to assessable income, and each lender’s list is different. A rising year is averaged down by some lenders and taken at the latest figure by others.
Contractors on a day rate are annualised with minimal fuss by some and treated as a start-up by others.
Most self-employed declines come down to five things: a falling year, an unaccepted tax debt, a young ABN or GST registration, unsupported add-backs, or the wrong lender. Each is visible before anything is lodged, which is why the financials are read first.
Illustrative only, not a lender’s published policy. A sole trader shows taxable income of $95,000 last year and $120,000 this year, with $8,000 of depreciation each year.
Mostly on low doc and alt doc loans, where an accountant’s declaration of income stands in for full tax returns, and when the latest return has not been lodged yet.
Some lenders also want a letter confirming add-backs, or that a large expense was a one-off.
The lender usually supplies its own form, and the accountant generally has to be a registered tax agent or a member of a professional body, independent of you. See the accountant letter template and low doc home loans.
Yes, and the same income rules apply as for a purchase: the new lender reads your latest returns, so it pays to refinance after a strong year has been lodged, not before. Some lenders also refinance an ATO debt that is on a payment arrangement.
A low doc loan taken while your returns were behind can often move to a full doc loan, usually at a lower rate, once two years of returns are lodged.
If your income has dipped, a refinance can lower the amount you are able to borrow, so weigh the saving against the borrowing you would give up. How refinancing works.
Yes, with some lenders: they accept one full year of financials, often with a previous salaried role in the same field. Others treat the first year as a low doc application, so lender choice decides the answer.
Yes, with the right lender. Some accept one full year of returns when the ABN has been registered for two years or you were salaried in the same field before; others treat it as low doc on BAS and bank statements. The file is matched to the lender before it is lodged.
A low doc or alt doc loan is assessed on business activity statements, business bank statements or an accountant’s declaration instead of lodged tax returns. Rates are usually higher and a larger deposit is common, so it bridges the first year or two in business.
Yes. The 5% Deposit Scheme and the NSW stamp duty exemption look at the buyer and the price, not the income type. The lender still assesses your financials in its usual way, so the scheme application goes to a participating lender whose self-employed policy fits.
Most lenders want two years of ABN registration and GST registration where turnover requires it. Some accept twelve months with strong trading figures. A newer ABN usually means a low doc or specialist lender until the two-year mark, then a refinance to standard rates.
Not always. Some lenders decline with any tax debt; others accept a payment plan that is up to date, shown on the integrated client account statement. Clearing or formalising the debt before the application widens the lender list, so the ATO position is read first.
There is no single one; it depends on the documents you have. With two years of tax returns, most mainstream lenders, including ANZ and Westpac, are open to you.
With one year of returns, a recent ABN or an accountant’s declaration, the choice narrows to lenders with one-year or alt doc policies, Resimac among them. Matching the lender to the paperwork is most of the job.
Thirty minutes is usually enough to know the right path, and what it will cost.
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