Client example
Gareth paid himself $90k. His company profit was $25k.
Gareth runs a heavy-haulage company. He paid himself a $90k wage, but the company profit was only $25k after buying 4 trucks.
The accounts also showed $140k in depreciation. The first assessment used his $90k wage and $25k company profit, without allowing for the depreciation shown in the accounts.
I rebuilt the numbers from the company accounts, depreciation schedule and loan statements. I checked which expenses only reduced profit on paper, which truck repayments still had to be paid and whether Gareth's wage had already been counted.
The short answer
I check your regular wage first. If that is not enough, I check the company accounts for usable profit, dividends and eligible business expenses. Then I compare the 2 figures before choosing a lender.
Which company director income calculation works best?
| Income being used | What the bank looks at | When it tends to help |
|---|---|---|
| Director wage only | Payslips, ATO Income Statement, company history and evidence the company can keep paying the wage. | The wage has been regular and is enough for the loan without relying on company profit. |
| Company accounts | Company and personal returns, profit and loss, balance sheet, liabilities and eligible business expenses. | The wage is modest but the business has usable profit or large expenses that only reduce the profit on paper. |
| Dividend income | Dividends actually paid, personal tax records and the applicant's shareholding. | The distribution history is clear and does not depend on a one-off accumulated payment. |
Which company director income calculation works best?
Director wage only
- What the bank looks at
- Payslips, ATO Income Statement, company history and evidence the company can keep paying the wage.
- When it tends to help
- The wage has been regular and is enough for the loan without relying on company profit.
Company accounts
- What the bank looks at
- Company and personal returns, profit and loss, balance sheet, liabilities and eligible business expenses.
- When it tends to help
- The wage is modest but the business has usable profit or large expenses that only reduce the profit on paper.
Dividend income
- What the bank looks at
- Dividends actually paid, personal tax records and the applicant's shareholding.
- When it tends to help
- The distribution history is clear and does not depend on a one-off accumulated payment.
What I checked in Gareth's accounts
| Account item | Starting figure | What still needed checking |
|---|---|---|
| Director wage | $90k | Was it already deducted before the $25k company profit was calculated? |
| Company profit | $25k | Was the figure before or after tax, and what share belonged to Gareth? |
| Depreciation | $140k | How much could be added back after checking the truck finance? |
| Truck finance | Separate loan schedule | Which repayments and interest still had to stay in the calculation? |
What I checked in Gareth's accounts
Director wage
- Starting figure
- $90k
- What still needed checking
- Was it already deducted before the $25k company profit was calculated?
Company profit
- Starting figure
- $25k
- What still needed checking
- Was the figure before or after tax, and what share belonged to Gareth?
Depreciation
- Starting figure
- $140k
- What still needed checking
- How much could be added back after checking the truck finance?
Truck finance
- Starting figure
- Separate loan schedule
- What still needed checking
- Which repayments and interest still had to stay in the calculation?
The bank still needs to confirm the final income. These figures show the order of the calculation, not an automatic $255k result.
Where does your income appear in the accounts?
Your wage
The regular amount paid to you through payroll.
Dividends already paid
Money distributed to you as a shareholder and shown in your tax records.
Profit left in the company
Money the business earned but did not pay out to you.
Expenses that may be added back
Items such as depreciation or an interest cost that will stop after refinance.
Can the bank use your director wage on its own?
I checked 8 lenders for this guide. They use 3 broad ways to assess a director wage or apply a simpler calculation.
| How lenders assess the income | What that can mean for you | What I check |
|---|---|---|
| Regular company wages may be enough: ANZ, NAB and Bankwest | The calculation may start with the wage paid through payroll rather than all company profit. | I confirm time in business, match the wage to payroll and check that the business can keep paying it. |
| A narrower director-wage option may exist: Teachers Mutual Bank, ME Bank and UBank | Ownership, business age and wage history can decide whether the simpler option fits. | I would test those 3 facts before asking for a larger set of company accounts. |
| Simpler calculations apply in selected situations: Firstmac and Resimac | Eligibility still depends on industry, ownership and evidence requirements. | I check the exact eligibility before relying on this option. |
Can the bank use your director wage on its own?
Regular company wages may be enough: ANZ, NAB and Bankwest
- What that can mean for you
- The calculation may start with the wage paid through payroll rather than all company profit.
- What I check
- I confirm time in business, match the wage to payroll and check that the business can keep paying it.
A narrower director-wage option may exist: Teachers Mutual Bank, ME Bank and UBank
- What that can mean for you
- Ownership, business age and wage history can decide whether the simpler option fits.
- What I check
- I would test those 3 facts before asking for a larger set of company accounts.
Simpler calculations apply in selected situations: Firstmac and Resimac
- What that can mean for you
- Eligibility still depends on industry, ownership and evidence requirements.
- What I check
- I check the exact eligibility before relying on this option.
Lender rules checked 30 July 2026 and reviewed quarterly. A general starting-point view of the 8 lenders named above, not a ranking, a recommendation or credit advice. Lending policy changes without notice, and any loan is subject to the lender's own credit assessment and approval of your full application.
How does your shareholding change the calculation?
If you own 100% of the company, the link between you and the profit is usually easier to explain. If you own 20%, the bank is less likely to assume you can take all of the money left in the business.
Macquarie requires company profit used in the calculation to be supported by dividends actually received when you own less than 50% and at least one other shareholder is not your spouse. Westpac and St George use ownership limits before they will look at profit left in the business. NAB may consider income you can direct to yourself when you have enough control. ING excludes profit left in a company owned through a trust.
That is why I confirm ownership first. A strong company result can still add nothing if the lender does not think you control or receive it.
If a family trust owns the shares or receives income from the company, also read the trust income home loan guide. It covers the trust layer of the income and ownership trail.
Depreciation may help, but the loan behind the asset does not disappear
Depreciation can make the profit look lower without the same amount leaving the bank account that year. That is why some of it may be added back. But a truck, excavator or piece of equipment can still have monthly finance attached to it.
Firstmac and Macquarie publish limits on how much depreciation they will add back. Other lenders calculate it differently. I read the depreciation schedule beside the asset finance statement instead of treating the full tax deduction as spare income.
I start with company profit and add back only the expenses the lender allows. I then check how it treats the asset finance so the repayments are accounted for once. If the director wage was already deducted in the accounts, it can only come back once.
What if the latest year is much stronger?
A fast-growing company can look very different depending on the lender. Bankwest may use the latest year when its conditions are met. Firstmac caps a stronger latest year at 120% of the earlier result. Suncorp averages when the recent year is higher, while Westpac and St George can use the latest year with a 10% reduction when their conditions are met.
I do not stop at the lender using the largest number. I also check whether the current BAS, bank statements and workload support it. A bigger result that is already falling can create problems late in the assessment.
Company debts can change the answer twice
A business loan may reduce company profit through interest and also create an ongoing repayment. I check both so the debt is not ignored or counted twice.
- If the debt stays, I match the interest expense and the repayment treatment.
- If it will be refinanced or paid out, I show the payout and the replacement cost.
- If the company supports a personal debt, I trace the payment rather than assuming it disappears.
The documents I check, in order
- OwnershipASIC records, your shareholding and how long you have been a director.
- Wage recordsPayslips, your ATO income statement and evidence the company can keep paying you.
- Company accountsCompany and personal returns, profit and loss statements and balance sheets if the wage alone is not enough.
- Equipment financeDepreciation and finance schedules where equipment costs have reduced the profit.
- Current tradingRecent BAS and business bank statements if the completed financial year no longer reflects the business.
Frequently asked questions
Experience and sources
How this guide was checked
We checked the public sources below on 17 September 2026 for director wages, company records and income assessment. The lender comparison above records the date of its wider policy review. We confirm current requirements against your documents and circumstances before recommending a loan.
Sources
General information only. Lender policies can change, and the lender must assess the full application. Technical broker references explain individual lender rules; they are not an approval or a rule shared by every lender.
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Compare your wage with the company result
Send me the shareholding, director history, current wage and latest company accounts. I will show you which figure is worth testing and the documents to collect first.
or call 1300 088 065
About this information: This article is general information, not legal, tax, financial or credit advice. Lender policy can change and the proposed lender must assess the full application.
Client examples are based on real situations. Names and identifying details have been changed.