Worked Examples and Checklists
Low-doc business loans in Australia: how lenders use BAS and bank statements
How low-doc and alt-doc business lenders assess income from BAS statements and bank statements, with a worked example, typical conditions and what to fix first.
A low-doc (or "alt-doc") business loan is assessed on recent BAS statements and business bank statements instead of full financial statements and tax returns. It suits business owners whose latest tax return is not yet lodged, whose accounts understate current trading, or who need a decision quickly. The trade-off is usually a higher rate or fee, a lower maximum loan-to-value ratio on property, and closer scrutiny of your bank account conduct. Before applying, make sure your BAS lodgements are up to date and your bank statements tell the same story as your BAS.
This guide is part of the business loan application checklist. Figures and policies are illustrative.
What low-doc lenders usually ask for
| Document | Typical requirement | What they look for |
|---|---|---|
| BAS statements | Last 4 quarters (or 12 monthly) | Sales trend, GST registration, lodgement on time |
| Business bank statements | 6–12 months, all accounts | Deposits matching sales, dishonours, overdraft use, ATO payments |
| ATO account statement | Current | Tax debt and any payment plan |
| ABN and GST registration | Usually at least 1–2 years ABN history | Stability |
| Accountant's declaration | Some lenders | Confirmation of income or ability to repay |
| Asset and liability statement | Most lenders | Existing debts and security |
Worked example: turning BAS figures into an income estimate
A mobile mechanic business is GST-registered. Its last four quarterly BAS statements show total sales (label G1, which includes GST):
| Quarter | G1 total sales |
|---|---|
| Q1 | $138,000 |
| Q2 | $126,000 |
| Q3 | $151,000 |
| Q4 | $157,000 |
| Total | $572,000 |
If all sales are taxable, the GST-exclusive turnover is $572,000 ÷ 1.1 = $520,000.
Bank statements show $640,000 of deposits over the same 12 months. The lender removes $53,000 of transfers between the business's own accounts and a $15,000 vehicle sale, leaving $572,000 of trading deposits. Customers pay GST-inclusive prices, so that matches the G1 total and the BAS and bank statements are consistent. (Timing differences of a few thousand dollars at quarter ends are normal.) Large unexplained differences are a common reason low-doc applications stall.
Low-doc lenders then need an earnings figure. Approaches vary:
- an accountant's declaration of expected income;
- an assumed margin on turnover for the industry. With an illustrative 15% margin, earnings would be $520,000 × 15% = $78,000;
- a calculation from bank account cash flows after expenses.
With $78,000 of estimated earnings and a debt service cover ratio of 1.5, the business could support repayments of $52,000 a year (about $4,333 a month). At an illustrative 10.5% over three years, that supports a loan of about $133,000; over five years, about $202,000. The arithmetic is the same as in the borrowing capacity guide, and the repayment calculator will confirm the repayments.
How low-doc pricing usually differs
| Feature | Full-doc | Low-doc (typical tendency) |
|---|---|---|
| Rate | Lender's standard pricing | Often higher |
| Maximum LVR on property | Lender standard | Often lower |
| Fees | Standard | Sometimes higher establishment fees |
| Lender types | Banks and non-banks | More often non-banks and specialist lenders |
| Speed | Can take longer | Often faster |
These are tendencies, not rules. Some lenders price low-doc loans close to full-doc for strong applicants with property security.
Common reasons low-doc applications fail
- Late BAS lodgements or BAS not yet lodged for the latest quarter.
- ATO debt not on a payment plan, or repeated missed payments to an existing plan.
- Bank statement conduct: dishonoured payments, regular overdraft breaches, gambling transactions, or large cash withdrawals.
- Sales falling quarter on quarter without explanation.
- Personal and business funds mixed in one account, making the figures hard to read.
- Not GST-registered, so there are no BAS sales figures for the lender to rely on.
Preparing a low-doc application
- Lodge any outstanding BAS and check that sales figures look right.
- Download your ATO account statement; set up a payment plan for any debt.
- Export 12 months of statements for every business account, not just the main one.
- Write a short note explaining unusual deposits or withdrawals.
- Prepare a list of assets and liabilities, including any equipment finance.
- Ask your accountant whether they will provide a declaration if needed.
Is low-doc right for you?
It suits:
- a business with good recent trading not yet reflected in lodged accounts;
- self-employed borrowers with profits reduced by legitimate deductions;
- a time-sensitive purchase.
It suits less well if your full financials are available and strong (full-doc is usually cheaper), or if you want the lowest possible rate on a large, long-term loan.
Frequently asked questions
Can I get a low-doc loan without GST registration?
It is harder, because BAS figures are a key input. Some lenders use bank statements alone or an accountant's letter, often with tighter limits.
Is a low-doc loan legal for business purposes?
Yes. Business lending is generally outside consumer responsible lending rules, so lenders can set their own documentation policies. They must still avoid misleading or unconscionable conduct.
Do low-doc lenders check my personal credit file?
Usually, for directors and guarantors.
Will a low-doc loan cost more in fees?
Often slightly more. Compare offers on total cost using the three-offer comparison.
Sources
- ATO — BAS lodgement, GST and payment plans
- business.gov.au — record keeping and preparing for finance
- ASIC Moneysmart — understanding loan costs
- ABN Lookup — ABN and GST registration history
