Self-Employed & Business Owners
Self-employed? Here is the income lenders can actually use
I read written lender policy for a living. Most self-employed people who tell me they will not qualify have never actually been assessed. They ruled themselves out on a rumour. This guide explains what lender policy really says, in plain English.
Last updated 9 July 2026
In short
Lenders can often use more of your self-employed income than you think. One good year of tax returns may be enough. So may lodged BAS (the GST activity statements your business sends the ATO), a letter from your accountant, or your business bank statements. It depends on the lender. The trade for lighter paperwork is usually a higher cost, a bigger deposit and a cleaner file overall. Knowing which trade you are making before you apply is the whole game.
Why self-employed borrowers rule themselves out
Your accountant's job is to legally shrink your taxable income, so you pay less tax. A lender's job is to read that same taxable income as proof you can repay a loan. Those two jobs pull in opposite directions. Self-employed borrowers get caught in the middle.
Compare lender policies side by side and one thing jumps out: appetite for self-employed income varies enormously. One lender wants two years of spotless financials. Another can work from a few months of business bank statements. Both exist, and both are writing loans right now. So the real question is not whether self-employed people can get home loans. It is which documents you have, and which lender's written policy accepts them.
Full doc does not always mean two years of everything
"Full doc" means proving your income the standard way, with complete tax returns. The usual request is two years of returns plus your notices of assessment (the ATO's summary of each lodged return). But several lenders I track can work from your most recent year's figures alone. That matters when the year before was ordinary and the latest one was strong.
Two wrinkles. First, if your latest year is lower than the one before, expect the lender to use the lower figure, or an average of the two. Second, your taxable income is not always the end of the story. Many lenders allow "add-backs". These are expenses that lowered your income on paper but do not drain your cash every year. Common ones: a portion of depreciation, one-off expenses, interest on debts being refinanced (refinancing means replacing an existing loan with a new one), and super contributions above the compulsory rate. Say you bought a work vehicle and claimed depreciation on it. That claim shrank your taxable income at tax time. But some lenders may add part of it back when they test serviceability - whether your income can support the repayments in the lender's maths.
One more pattern. If your company pays you a regular wage, some lenders can treat those consistent salary credits much like employee income. They usually want your accountant to confirm the business supports that wage.
Not sure which of these applies to you? That is exactly what a position check answers - free, same-day reply.
Request a position checkor call 0451 389 800The alt-doc ladder: BAS, accountant letters and bank statements
"Alt doc" is short for alternative documents - proving your income without full tax returns. It exists for exactly this situation: your returns do not reflect where the business is now. The structure is consistent across specialist lenders. You sign a declaration of your income. Then you support it with one form of evidence - typically an accountant's letter, six to twelve months of lodged BAS, or several months of business bank statements.
Say your last tax return covers a slow year, but the business has grown strongly since. Recent BAS or bank statements could show a lender the current picture in a way the old return cannot. Whatever the route, the declared figure has to look plausible against the evidence. If your declaration says one thing and your BAS suggest another, that is a problem, not a technicality. Alt doc is a different way of verifying honest income. It is not a way around verifying it.
A short ABN is not an automatic no
Two years of trading is the comfortable ask. But some lenders can consider around 12 months of ABN history. A small number can look at roughly six months. That usually applies where you previously worked in the same industry as an employee, and the income you declare makes sense against that history.
Say you spent years as an employed electrician, then started your own business under a year ago. If your declared income lines up with what you earned on wages, some lenders could consider it, because the story holds together. GST registration matters too once turnover passes the ATO's $75,000 threshold. Some lenders want a year of GST registration behind you; others can accept much less. The clock starts when you register, not when you decide to buy. So get the ABN and GST sorted early.
The honest trade-offs
Flexibility is not free, and I would rather you hear it now than at approval. Specialist and alt-doc lending is generally priced above a clean payslip loan at a major bank. Some lenders charge a risk fee in place of lenders mortgage insurance (LMI - the fee banks charge buyers with small deposits). Alt-doc loans often cap out around 80% of the property's value - the share you borrow is called the LVR. So you need a bigger deposit, or more equity (the part of your home you own outright). Full-doc self-employed loans can reach low-deposit territory with some lenders.
The other cost is scrutiny. The lighter the income paperwork, the harder lenders look at everything else: your repayment history, how you run your accounts, and your credit report. None of this is permanent. Plenty of my clients start on a specialist loan. They refinance to a new loan once the tax returns catch up with the business.
Being self-employed does not lock you out of government support either. The federal 5% Deposit Scheme through Housing Australia has no income caps or place limits (participating lenders and property price caps apply). The QLD $30,000 First Home Owner Grant applies to new builds under $750,000. Your income is verified the same way under these schemes. What changes is the deposit maths.
The order to do things in
Sequence matters. Talk to a broker before your accountant lodges this year's returns. How you draw and report your income affects what a lender can use. Once a return is lodged, you live with it.
Keep your BAS lodged on time. Keep your ATO account clean, or on a documented payment plan. Tax debt is not automatically fatal - some lenders can consider refinancing it - but they want a reason it happened and evidence of repayments. Keep business and personal banking separate. That way your trading statements are usable evidence later. And get your position checked before you apply anywhere. A decline on your file makes the next application harder.
Frequently asked questions
I have only been self-employed for a year. Can I get a home loan?
Possibly. Some lenders can consider around 12 months of ABN history. A small number may look at roughly six months, where you previously worked in the same industry and your declared income lines up with that history. Expect the lender to lean harder on the evidence: bank statements, BAS and your track record. Eligibility applies. The shorter your history, the cleaner the rest of your file needs to be.
My tax returns do not show my real income. What are my options?
Two things are worth checking before you give up. First, add-backs. Under full-doc policy, part of your depreciation, one-off expenses, interest on debts being refinanced and extra super contributions may be added back to your taxable income. Second, alt doc (proving income without full tax returns). Some lenders can consider a signed income declaration supported by an accountant letter, lodged BAS or business bank statements. What you declare still has to be honest and plausible against the evidence.
Does alt-doc lending cost more?
Usually, yes. Alt-doc loans are generally priced above a clean payslip loan at a major bank. Some lenders charge a risk fee in place of lenders mortgage insurance (the fee banks charge buyers with small deposits). The deposit requirement is often larger too. I treat it as a stage, not a sentence: settle on the loan the paperwork supports today, then review a refinance once the tax returns catch up to reality.
I have a tax debt with the ATO. Is that the end of it?
Not automatically. A number of specialist lenders can consider refinancing or consolidating ATO debt into a home loan. The pattern in their policy is consistent. They want a sensible explanation of how the debt arose, confidence it will not simply rebuild, and often a history of repayments on any payment plan. Eligibility applies, so check properly rather than assuming either way.
Want to know what your income looks like on paper?
Send John the basics and he will check your scenario against current written lender policy first.
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General information only, not credit advice. Your circumstances, lender criteria and responsible lending requirements apply. John Carson-Zangor is a credit representative (537545) of QED Credit Services Pty Ltd, Australian Credit Licence 387856.