Business loans without financials or up-to-date tax returns

Plenty of good businesses don’t have neat, current financials. The accountant is three months behind, last year’s return isn’t lodged, or the business is run by someone who is brilliant at the work and not so keen on the paperwork. None of that is unusual. It just doesn’t suit a bank, whose process starts with two years of tax returns. If that’s your situation, there are lenders who start somewhere else.

What lenders use instead of financials

Document	What it shows	Who accepts it
Business bank statements (6 – 12 months)	Real deposits, spending patterns, other lenders	Most unsecured and line-of-credit lenders
BAS	Declared turnover each quarter	Many low doc lenders
Accountant’s declaration	An accountant’s confirmation of income	Some low doc and private lenders
Contracts or invoices	Money that’s coming in	Invoice and contract-based lenders
Property details	Equity available as security	Private lenders

The most important of these, by far, is the bank statement. It’s hard to fake, it updates every day, and it shows a lender things a tax return never will: whether the balance dips into overdraft every week, whether there are dishonoured payments, and whether other lenders are already taking repayments.

Low doc versus no doc

“Low doc” means fewer documents, not none. A lender still has to be satisfied the loan suits you and that you can repay it, so expect to provide ID, statements and details of the business. True “no doc” lending has largely disappeared from responsible lenders.

The closest thing is a property-secured private loan. Because the lender relies mainly on the property and the exit plan, the paperwork is light: ID, the property details, a rates notice, a mortgage statement if there’s an existing loan, and a short explanation of what the money is for and how it’ll be repaid. See caveat loans for how this works.

When your taxable income is the problem

This catches a lot of owners out. Your accountant does a great job of keeping taxable profit low, so the tax return shows a modest income. The bank reads that number and decides the loan doesn’t service. Meanwhile the business is turning over strongly and paying its bills.

Bank-statement lenders get around this by measuring what’s actually coming in. Some lenders will also accept an accountant’s letter that adds back legitimate non-cash and one-off items, such as depreciation, to show the true profit.

Behind on lodgements?

If BAS or tax returns are overdue, deal with it in parallel. Many lenders want lodgements current even if the tax isn’t paid yet, because an unlodged return means nobody knows the real tax position. Your accountant can often lodge quickly once you supply the records. If there is tax to pay, our page on ATO debt explains how lenders handle it.

An illustrative example

A Hobart landscaping business (illustrative only) had turned over strongly for three years, but the owner’s tax returns were two years behind after a change of accountant. The business needed $60,000 for a tipper truck and a mini loader before the spring rush. The bank wouldn’t proceed without lodged returns. A bank-statement lender reviewed twelve months of business statements and the last four BAS, saw consistent deposits and no other lenders, and approved a combination of equipment finance for the machinery and a small line of credit for wages. The owner caught up on lodgements over the following quarter.

Questions a low doc lender will ask

Expect a short phone call rather than a long form. The lender, or the person handling your file, will usually want to know:

• What the business does, how long it’s been trading and who the main customers are
• Roughly what it turns over each month, and whether that’s steady or seasonal
• Why the financials aren’t available yet, and when they will be
• Whether there’s any tax owing, and whether the BAS is up to date
• What the money is for and how much you actually need
• Whether there are other loans, especially daily or weekly repayment loans
• What property or assets could support the loan if needed

Straight answers to these questions often matter more than any single document. A lender who understands the business quickly can make a decision quickly. A file that changes its story halfway through, or a turnover figure that doesn’t match the bank statements, will slow everything down or end in a decline.

Getting organised quickly

• Download 6 to 12 months of business bank statements as PDFs, every page
• Print your last four BAS lodgement confirmations from the ATO portal
• Ask your accountant whether they’ll provide an income declaration
• List any property, vehicles or equipment you own and what’s owed on them

Let’s look at what you do have

Financials not ready? Start your enquiry anyway. There’s no credit check when you first get in touch, your details stay with the team handling your file, and a real person will work out which lender can assess you on the documents you’ve got. Please be accurate about your turnover and any tax owing on the form; it saves a lot of back and forth later. See if you qualify.