Getting a business off the ground is hard enough without having to chase two years’ worth of tax returns just to buy a new piece of equipment. If you’re self-employed, running a small operation, or dealing with inconsistent cash flow, applying for finance can feel like an uphill battle before you even start.
That’s why low doc business loans exist. They’re a practical option for self employed borrowers and sole traders who need funding but don’t have the full stack of financials ready to go. In this guide, we’ll walk through how they work, what sets them apart from regular business loans and traditional bank loans, what kind of paperwork you’ll actually need, and whether they might be the right fit for your next purchase.
What is a Low Doc Business Loan?
A low doc (short for “low documentation”) business loan lets you apply for finance without needing to supply full financial statements, tax returns or Business Activity Statements (BAS). It’s a way of showing your ability to repay a loan using alternative documents, and it’s often a faster, more practical option for small business owners who don’t have time to chase paperwork.
We see it most often used for equipment purchases, whether that’s machinery, tools, tech or even full business fit-outs.
How is it Different from a Regular Business Loan?
The main difference comes down to the paperwork. Traditional full doc loans usually require up-to-date financials, including at least two years’ worth of tax returns and financial statements. That’s not always easy to pull together, especially if your accounts aren’t up to date or your income varies month to month.
A low doc loan, on the other hand, relies on a mix of alternative documentation. Most lenders will want to see that you’ve held an ABN for at least two years and are registered for GST. You’ll typically be asked for a signed declaration of income from your accountant, along with either recent BAS or bank statements to support your declared income. Some lenders also require an asset and liability statement from the business owner, or additional security like a 20 percent deposit or an owned or mortgaged property.
Every lender is a little different in how they assess low doc applications, but the goal is the same: to give business owners access to finance without needing a perfectly polished paper trail.
Who Uses Low Doc Business Loans?
Low doc business loans are a great option for sole traders who haven’t lodged recent tax returns, or for self-employed business owners who don’t have formal financials on hand. We also work with small businesses that deal with seasonal income or irregular cash flow, making it hard to show consistent earnings on paper. These loans can also suit professionals who may not yet have a long trading history but need equipment to keep their business moving forward.
If that sounds familiar, you’re not alone. We’ve helped plenty of clients in similar situations, including many who assumed they’d need to wait months before being eligible for finance. A low doc loan can be the thing that gets you unstuck.
What Can You Use It For?
Low doc loans can be used to finance a wide range of business equipment. We regularly help clients secure funding for manufacturing machinery, earthmoving and construction equipment, trailers, forklifts, compressors, and even full medical or dental setups. They’re also a great option for things like coffee machines, AV equipment, computer hardware, and office fit-outs.
If it’s a genuine business asset that will help generate income, there’s a good chance it can be financed under a low doc agreement.
Are the Interest Rates Higher?
Sometimes, but not always. While low doc loans are seen as slightly riskier by lenders, many offer competitive rates if you meet certain criteria such as having a good credit history or offering a deposit. It’s definitely worth comparing rates and speaking with someone who understands how these loans work before locking anything in.
We often find that the speed and simplicity of a low doc loan far outweigh the small difference in cost, especially when you need that equipment to start earning sooner.
What Should You Watch Out For?
There’s no major catch, but there are a few things to be aware of. These loans are designed for applicants with a reasonably clear credit file and some form of supporting evidence, even if that evidence isn’t a full set of financials. If you’ve got property equity or a decent deposit to put down, that will usually work in your favour with traditional lenders.
Ready to Get Started? Apply Today with Credit One
If you’re ready to move ahead with a business finance solution that doesn’t bog you down in paperwork, we’re here to help. At Credit One, we’ve helped thousands of small business owners secure finance while keeping their focus where it needs to be.
Whether you’re after flexible business equipment finance or just want to see what’s possible, you can get started in minutes with our easy online loan application. Not quite ready to apply? No problem. Use our loan calculator to estimate your repayments and explore your options.
