What lenders really look at on your tax return

If you're self-employed, the tax return you optimise for the ATO is the same one a lender uses to size your home loan. That's the tension at the heart of self-employed lending, and the reason a good broker can change the outcome by a few hundred thousand dollars without you changing a single number.

What lenders read: net profit (sole trader) or company profit + director's salary + dividends + retained earnings (Pty Ltd). Then they average the last two years (most lenders) or use the most recent year (some lenders, for growing businesses).

What they add back to lift your assessable income: depreciation, one-off expenses, non-cash deductions (CGT, asset write-offs), additional super contributions, owner's wages paid to a spouse. Done well, add-backs can lift assessable income by 20–40%.

What kills deals: trending down (year 2 lower than year 1), heavy personal use of the company car booked as a business expense, large director loan accounts, mixed personal/business on a single account. These don't mean you can't borrow; they mean you need the right lender.

The fastest fix for most self-employed applicants is lender selection: low-doc lenders that accept BAS or accountant's letter, full-doc lenders that accept one year of returns, or full-doc lenders that handle complex trust structures cleanly. Different lender, different answer, same numbers.