Key takeaways
- Add-backs restore certain tax deductions to your income for loan assessment.
- Common ones: depreciation, one-off expenses, extra super, interest being refinanced.
- They can lift your assessable income — and your borrowing power — substantially.
- Lenders treat add-backs differently, so lender choice and presentation matter.
There’s a built-in tension for the self-employed: a good accountant minimises your taxable profit, but a low profit makes a bank think you can’t afford a loan. Add-backs resolve it. They let a lender see past the tax-optimised figure to your genuine earning capacity — and for many business owners, they’re the difference between a knock-back and an approval.
Why your tax return understates you
Legitimate deductions — depreciation, one-off purchases, extra super — lower your taxable profit, which is exactly what you want at tax time. But a lender reading only the bottom line sees a smaller income than you really have. Add-backs are the correction: specific items are added back to reveal your true position.
What lenders commonly add back
- Depreciation. A paper expense, not real cash out the door.
- One-off or non-recurring expenses. Costs that won’t repeat.
- Additional superannuation. Voluntary contributions above the minimum.
- Interest on debts being refinanced or cleared. Where the expense is going away.
Lenders don’t all accept the same add-backs. One might add back depreciation and extra super while another ignores them — producing two very different assessable incomes from the identical financials. That’s why the lender you choose can change your borrowing power dramatically.
How this builds borrowing power
A higher assessable income improves your serviceability, which lifts your borrowing capacity. Presented well to the right lender, add-backs can meaningfully increase the loan you qualify for — without changing a thing about how you run your business or file your tax.
Getting it right
Maximising add-backs is part accounting, part lender knowledge. It works best when your self-employed application is packaged for a lender whose policy is generous on the items that apply to you — and, for newer businesses, it pairs with the shorter-history and low doc options. We’ll always work in step with your accountant on the numbers.
Broker Insight. Two lenders can read identical tax returns and land on very different incomes, because they add back different things. For the self-employed, that difference is often the whole ballgame.
Turn your real income into borrowing power
We’ll review your financials, identify every legitimate add-back, and match you to the lender that counts them — so you borrow what you’ve genuinely earned. Free, no obligation.
Book your free game plan callFrequently asked questions
What are add-backs on a home loan?
Add-backs are certain expenses subtracted from your business profit for tax purposes that a lender will “add back” to work out your true income for a home loan. Because self-employed people often reduce taxable profit through legitimate deductions, their tax return can understate what they actually earn. Add-backs correct for that — giving you a higher assessable income and, in turn, more borrowing power.
What expenses can be added back?
Common add-backs include depreciation, one-off or non-recurring expenses, additional superannuation contributions above the minimum, interest on debts being refinanced or paid out, and sometimes a portion of certain non-cash or discretionary items. What each lender accepts varies, so the same financials can produce different assessable incomes depending on the lender — which directly affects how much you can borrow.
How do add-backs affect how much I can borrow?
They can increase it significantly. If a lender adds back depreciation and other allowable items, your assessable income rises, which lifts your serviceability and borrowing capacity. Because lenders treat add-backs differently, choosing the right one — and presenting your financials properly — can be the difference between the loan you want and a smaller one.
This guide is general information only and does not take your personal circumstances into account. It is not financial or credit advice. Government schemes, lender policies, rates and tax rules change over time and eligibility criteria apply. Speak with us for advice tailored to your situation.