Tax Debt? We Can Help You Clear It And Still Access The Machinery You Need

Business Growth & Financial Solutions
4 min read
Tax Debt Article Yellowgate Group

With the Australian Taxation Office’s changes to General Interest Charges (GIC) effective from July 1, 2025, your outstanding ATO debt has just become more expensive to hold.

The new law passed by the Australian Government prevents taxpayers and businesses from claiming tax deductions for GIC incurred from July 1. So, there’s never been a better time to assess your finances and explore how Yellowgate Group can help clear your tax debt.

The good news is Yellowgate Group can help businesses impacted by the new GIC laws to free up equity in their existing equipment, to help clear their tax debt.

Our Rent Now, Buy Later solution allows you to unlock the equity in your existing equipment and convert it into cash. We do this by purchasing your equipment and renting it back to you on a 12-month Rent Now, Buy Later plan.

With equipment rental being a tax-deductible operational expense, it means your business can still utilise the equipment needed for revenue-generating activity, clear your tax debts with the equity in your equipment, and claim the rental payments as an operating expense.

But the benefits of Rent to Own equipment don’t stop there. There are additional tax advantages of utilising a Rent to Own model to source your heavy machinery, rather than going direct to market and buying it outright. 

So what are some of the other benefits? We’ve listed a few of them below.

The key benefits of the Rent to Own model

Tax-Deductible Rental Payments

As mentioned above, unlike traditional loans or leases – where only the interest component may be deductible – rental payments under a Rent to Own agreement are classified as operational expenses. This means the full rental amount may be claimed as a tax deduction, lowering taxable income and improving year-end financial outcomes.*

*All taxation and accounting considerations are general advice only. Seek independent advice from your accountant before making any decision based on this information.

Off-Balance Sheet Equipment

Rent to Own equipment is generally not recorded as a liability on your balance sheet during the term of the rental agreement. This can improve financial ratios and make your business more attractive to lenders, investors, or project partners. It also reduces administrative burdens associated with asset depreciation tracking for your financial department.

Deferred Capital Outlay

By deferring the outright purchase of equipment, businesses can manage cash flow more effectively and avoid triggering immediate CapEx limits. This is particularly advantageous during periods of rapid growth, seasonal demand, or while awaiting project approval.

GST and Input Tax Credits

If your business is GST-registered, you may be able to claim GST credits on the rental payments. This further enhances cash flow and reduces the net cost of equipment access.

Who Benefits From Rent To Own Machinery?

There are plenty of reasons for businesses to choose an alternative Rent to Own pathway to asset ownership over simply buying equipment outright with finance.

Many such businesses:

  • Operate under short-term or rolling contracts
  • Need to preserve cash reserves for labour or project costs
  • Have only recently started and would like to avoid major capital commitments
  • Are GST-registered and are looking to maximise deductible expenses
  • Need access to new equipment without impacting credit lines

They’re also operating across a range of industries and fields, including but not limited to:

  • Construction and Civil Engineering
  • Earthmoving and Excavation
  • Mining Operations
  • Road Building and Infrastructure Projects
  • Agriculture and Land Development

These are all industries that often face tight project timelines and shifting capital budgets, making Rent to Own construction equipment an obvious tactical advantage in managing both machinery access and the tax efficiencies the model generates.

How Rent To Own Machinery Works In Practise

Let’s say you’re a construction company looking to use a Rent to Own strategy to secure a new front-end loader without exhausting your CapEx limit.

You simply select the loader you need, we can source and secure it for you, and you use the loader to generate revenue over the 12-month term of the rental agreement. 

You’re able to claim each rental payment as a deductible expense – improving your year-end financial position – while you retain the right to purchase the equipment outright at the end of the term. 

You can then choose whether to purchase the loader at a discounted price at the end of the rental agreement – with your rental payments reducing the cost of the total price you pay – or otherwise continue renting it, or simply return it.

All of which means you can preserve your working capital, leave room in your budget for other projects, and reap the tax and financial benefits of not automatically choosing to purchase equipment outright.

Talk To Yellowgate About Your Rent To Own Options

The advantages of Rent to Own machinery and construction equipment go far beyond mere affordability. 

For growth-focused businesses and those looking to limit their CapEx expenditure, it’s a model that offers a smart, scalable way to access essential machinery while optimising the tax benefits over a 12-month period.

It’s also a model that allows you to get on the front foot and clear any lingering tax debts ahead of the new GIC legislation coming into effect on July 1, 2025.


Contact us to find out more about the tax benefits of our flexible Rent Now, Buy Later solutions.

Contact