Australian Business Loan Calculator

Last updated: May 2026. Reflects current Australian metrics.

Forecast your commercial loan repayments. See how much interest you will pay and estimate the potential tax deductions for your business.

Commercial Loan Details

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Estimated Repayment

per month

$0
Amount Financed $0
Total Interest Over Term $0
Est. Tax Saving on Interest (25% rate) $0
Total Repayments (Principal + Interest) $0

Business Lending in Australia

Whether you need working capital, want to hire new staff, or need to buy out a competitor, business loans are the fuel that grows the Australian economy. However, commercial finance operates very differently from consumer finance.

Secured vs Unsecured Commercial Finance

A secured business loan requires collateral. In Australia, this is often a 'Directors Guarantee' backed by a mortgage over the director's residential property. Because the bank can take your house if the business fails, the risk is very low, and you can secure interest rates close to residential mortgage rates (e.g., 6-8%).

An unsecured business loan relies purely on the cash flow and trading history of the business. These are often provided by fintechs and alternative lenders rather than the Big 4 banks. Because the lender has no hard assets to repossess if the business goes under, unsecured rates are much higher (typically 12% to 25%+) and the terms are shorter (often 1-3 years).

Tax Deductibility of Interest

Unlike a personal loan for a holiday, the interest you pay on a business loan is generally a tax-deductible business expense. For a small 'base rate entity' company in Australia (turnover under $50m), the corporate tax rate is 25%. This means if you pay $10,000 in interest over the year, your taxable income is reduced by $10,000, saving you $2,500 in tax. Note: You can only deduct the interest portion of the repayment, not the principal.

Related Calculators

Business Loan Equipment Finance Invoice Finance

Read official business finance guidelines at Business.gov.au.

10 Frequently Asked Questions

1. What is Equipment Finance?
Equipment finance (like a chattel mortgage) allows a business to borrow money to buy an asset, using the asset itself as security.
2. How does Invoice Financing work?
Invoice financing lets you borrow money against the amounts due from your customers, freeing up immediate cash flow.
3. What is an Unsecured Business Loan?
A loan that doesn't require collateral. It usually has higher interest rates and shorter terms due to the higher risk for the lender.
4. Can I claim the interest on a business loan?
In Australia, interest incurred on loans used strictly for business purposes is generally tax-deductible. Check with the ATO.
5. What is the instant asset write-off?
An ATO measure allowing businesses to claim an immediate deduction for the business portion of the cost of an asset in the year it is first used.
6. What is a line of credit?
A flexible loan where you are approved for a certain limit but only pay interest on the funds you actually draw down.
7. Are Directors Guarantees required?
Most lenders will require a personal guarantee from the company directors, even for unsecured business loans.
8. What is a Chattel Mortgage?
A commercial loan product where the financier advances funds to purchase an asset, taking a mortgage over it as security.
9. How do lenders assess business loans?
Lenders look at trading history, cash flow, BAS statements, and business credit scores.
10. Does a business loan affect my personal credit?
If you provide a personal guarantee or are a sole trader, defaults will negatively impact your personal credit file.