Refinancing When Self-Employed: What Lenders Actually Want

Here's the frustration I hear most from business owners: "I earn more than I did as an employee, and the bank treats me like a risk." Refinancing while self-employed isn't harder because your income is worse - it's harder because it takes more explaining. So let's explain it properly.

What lenders are actually trying to establish

One thing: that your income is real and repeatable. A payslip answers that in one page; a business answers it across tax returns, financials and activity statements. Everything below is just different ways of demonstrating the same thing.

The standard evidence (full-doc)

• Two years of tax returns - personal and business - plus notices of assessment. Some lenders will work with one year, which matters enormously if your latest year is your best.
• Sometimes: recent BAS or interim financials, to show the current year is tracking well.

If your paperwork is behind, that's the first fix - not because lenders are pedantic, but because until the returns exist, your best year officially doesn't. Your accountant becomes your most valuable teammate here (and if you need a good one, I know a few locally).

Add-backs: where good presentation earns real money

Your taxable income is engineered to be low - that's what you pay your accountant for. Lenders know this, and most will add back legitimate items when assessing you: depreciation, one-off or non-recurring expenses, interest on debts the refinance will clear, and super contributions above the compulsory minimum. Presented well, add-backs can lift your assessable income substantially - same business, same year, very different borrowing power. This is the single biggest reason self-employed refinances succeed with one lender after failing with another.

If full-doc doesn't fit: the alternatives

Low-doc options let you evidence income through BAS, business bank statements, or an accountant's declaration instead of full returns - usually at somewhat higher rates. Used well, they're a bridge, not a destination: get the loan done now, then refinance to sharper full-doc pricing once your next returns land. Structures matter too - company and trust setups don't faze the right lenders, but they absolutely faze the wrong ones.

Timing: refinance after the good year, not before

If this financial year is strong and last year was ordinary, finish the returns and then refinance - with lenders who'll assess your latest year rather than a two-year average. If last year was rough, sometimes honest advice is to wait two quarters and build the story. Either way, an early conversation costs nothing and stops you applying at the worst possible moment (every application touches your credit file, so aim once).

The honest wrap

Self-employed refinancing rewards preparation and lender choice more than anything else in lending. It's also where a broker's value is least arguable: I do this for a living, from sole traders to company-and-trust structures (and SMSF lending when that's the fit), across the business-owner heartlands of Melbourne's east and south-east. If you were declined before, that's a data point about one lender's policy - not about your business. New here? Start with the self-employed home loans guide.

Quick answers

What documents do I need to refinance when self-employed?

For a full-doc application, typically two years of personal and business tax returns plus notices of assessment, and sometimes recent business activity statements or interim financials. Some lenders accept one year. Low-doc alternatives exist using BAS, business bank statements or an accountant's declaration - usually at slightly higher rates.

Do lenders just use my taxable income?

Good ones look deeper. Legitimate add-backs - depreciation, one-off expenses, interest on debts being refinanced, extra super contributions - can be added back to your taxable income for assessment. Two brokers presenting identical financials can produce very different assessable incomes, which is why presentation genuinely matters.

My bank knocked back my refinance - is that the end of it?

Rarely. Lenders differ enormously on self-employed policy: how many years of financials, how they treat a variable year, company and trust structures, and industry attitudes. A decline from one lender says little about the other 40+. The fix is usually matching, not waiting.

Want your business income presented the way lenders respect? Start your obligation-free enquiry → or call Michael on 0477 979 377.

Written by Michael Gross - Principal Mortgage Broker & Founder, Mocha Finance. A former financial planner with 8+ years in finance, Michael compares 40+ lenders for clients across Melbourne. Credit Representative 546597 of LMG Broker Services Pty Ltd (ACL 517192) · FBAA Member.
Reviewed and updated 4 July 2026. Rates, fees, schemes and lender policies change over time - always confirm current details. Examples on this page use clearly labelled illustrative figures, not current market rates.

Michael Gross is a Credit Representative (546597) of LMG Broker Services Pty Ltd (ACN 632 405 504, Australian Credit Licence 517192). The information on this page is general in nature and doesn't take into account your personal objectives, financial situation or needs - consider whether it's appropriate for your circumstances before acting on it.