01
Reading your real income
Smart tax planning often reduces your taxable income, which is good at tax time but can understate your real earning power to a lender. The right lender looks past the headline figure with sensible add-backs.
Self-employed Australians are the backbone of the economy, yet many feel they are penalised when it comes to borrowing. The truth is more nuanced. A home loan as a business owner is rarely impossible, but it is very sensitive to which lender you choose and how your income is presented.
The thing to understand about a self-employed home loan is that lenders read business income very differently. Some take the most conservative figure on your tax return; others add back non-cash expenses and recognise retained profits, producing a much higher assessable income. As a team of trusted Melbourne finance brokers, we match you to the lender that reads your business fairly, and use low doc options where they make sense. If your recent financials do not yet reflect your real income, a low doc home loan may verify it another way.
Are you self-employed and looking to buy or refinance? Call us on 1300 562 696 and we will work out which lender reads your income best.
The Self-Employed Challenge
A self-employed mortgage is not harder because business owners are riskier, but because the income is more complex to read. These are the issues to know:
02
Weighing your financial history
Most lenders want one to two years of business financials and personal tax returns. Some accept one year, which helps newer businesses; others want two for a fuller picture. The requirement varies by lender. Some even want only Notices of Assessment, which can be helpful for complex income streams.
03
Averaging your variable income
Business income can move year to year. Lenders generally average it, sometimes capping growth, so a strong recent year is read in context. A lender familiar with your industry reads this more fairly.
04
Assessing your business structure
Sole trader, company or trust, your structure affects how income flows and how it is assessed. The right structure and the right lender together make a real difference to what you can borrow.
Full Doc and Low Doc Explained
There are two broad paths for self-employed borrowers, and the right one depends on your financials:
| Full doc | Low doc (also known as Alt-doc) | |
|---|---|---|
| Income evidence | Business financials and tax returns | Accountant declaration, business activity statements (BAS) or bank statements |
| Best for | Up-to-date, representative financials | Returns not yet lodged or not reflecting current income |
| Rates | Sharpest, widest lender choice | Usually a small premium |
| Deposit | Standard | Slightly larger |
| Fees | Standard | A risk fee may apply where above 70% LVR in some cases |
This table is a general guide only; rates, deposits and document requirements vary by lender and your situation. The right path depends on your documents and timing: sometimes lodging a return unlocks a better full doc deal, sometimes a low doc loan now is the smarter move.
Add-Backs and Getting the Structure Right
Add-backs are the heart of a strong self-employed application. Lenders that understand business will add back non-cash and one-off expenses to reach a fairer income figure than your tax return shows on its own. Common add-backs include:
- depreciation
- additional superannuation
- interest on refinanced debt
- one-off or non-recurring costs
- undistributed company profits
Which add-backs a lender accepts varies, and that variation can change your borrowing capacity by a large margin. Alongside the income, the way your business is structured affects the assessment, which is why we look at both together and present your full picture to the lender most likely to reward it.
Why Business Owners Work With Loanworx Group
Lender differences on self-employed income are wide and not advertised. As self-employed mortgage brokers, we make those differences work for you:
01
We know who reads business income fairly
Which lenders accept one year of financials, which apply the most generous add-backs, and which offer the best low doc terms. With over 1500 products, we match you to the strongest fit.
02
We present your income properly
The right financials, the right add-backs, and a clear story for the lender. We often work alongside your accountant so your income is presented at its genuine strength.
03
We keep it straightforward
You are busy running a business. We handle the legwork, keep things clear, and aim for a supported, stress-free experience from first chat to settlement.
Self-Employed and Ready to Buy? Let’s Talk
Running your own business should not hold you back. Loanworx Group will match you to a lender that reads your income fairly and find the path, full doc or low doc, that suits you best. Call us on 1300 562 696.
Who We Help
Being self-employed is one of many situations we help borrowers navigate. Explore the other groups and professions we help below.
Doctors
Medico home loans with LMI waived at high LVRs, plus rate and fee benefits for medical practitioners.
Nurses
Home loan benefits and waivers available to registered nurses and midwives, including shift income.
Pharmacists
Tailored home loans and LMI waivers for pharmacists and community pharmacy owners.
Engineers
Professional home loan benefits and LMI waivers for qualified and chartered engineers.
Lawyers
LMI waivers and professional packages for solicitors, barristers and legal professionals.
Dentists
Medico-tier home loans and LMI waivers for dentists, specialists and practice owners.
Low Doc Loans
Home loans with alternative income verification when standard payslips don’t fit.
Teachers
Home loan options and waivers available to teachers and education staff.
LMI Waivers
Borrow up to 90% or more without lenders mortgage insurance, if you qualify.
IT Contractors
Home loans structured for contract and day-rate IT professionals.
Government Help
First home grants, schemes and concessions, explained and matched to you.
Frequently Asked Questions (FAQs)
Can I get a home loan if I am self-employed?
Yes. The loan itself is usually not the hard part; the difference is finding a lender that reads business income properly. The right one credits your real earning power and the add-backs that apply, not just the lowest figure on your return.
How many years of financials do I need?
Usually one to two years, though it varies by lender. A single year can be enough for a newer business, or where there have been material changes or improvements to the business, while some lenders prefer two. If yours are not ready, a low doc loan can verify your income another way.
What is a low doc home loan?
A low doc loan lets self-employed borrowers verify income without full financials, using an accountant’s declaration, BAS or bank statements. It suits business owners whose latest returns are not lodged or do not reflect current income. Rates are usually a little higher than full doc.
What are add-backs?
They are expenses that lower your taxable income on paper but are not ongoing cash costs, such as depreciation, additional super or interest on refinanced debt. A lender that recognises them assesses you on a fairer, usually higher, income, which can shift what you are able to borrow.
Does my business structure affect my loan?
Yes. How a sole trader, company or trust reports and distributes income changes how a lender assesses it, and some lenders handle particular structures better than others. We weigh your structure alongside your income, not just the headline figure.
Are self-employed home loan rates higher?
Full doc loans for self-employed borrowers access the same sharp rates as anyone else. Low doc loans typically carry a small premium because income is verified differently. We compare both so you can weigh the rate against getting into the market now.
Should I wait to lodge my next tax return?
It comes down to your timing and your numbers. A recent return can unlock a stronger full doc option, but waiting may not be worth it if a low doc loan gets you moving now. We model both so you can decide with the figures in front of you.
