True wellbeing begins at home.
Getting a home loan when you are self-employed is not harder - it just requires different preparation. Lenders want to see stable, verifiable income, and for self-employed borrowers that means understanding how your income is assessed and presenting it correctly.
By Jason Given · January 2026 · 6 min read
How lenders assess self-employed income
For PAYG employees, income verification is straightforward - payslips and group certificates. For self-employed applicants, lenders typically require two years of personal tax returns and notices of assessment, two years of business tax returns and financial statements, and current BAS statements.
The lender uses your taxable income - the income shown on your tax return after all deductions - as the basis for assessment. This is important because many self-employed people legitimately minimise their taxable income through business expenses, depreciation and other deductions. From a home loan perspective, a lower taxable income means lower assessed borrowing capacity.
The two-year tax return requirement
Most lenders require two consecutive years of self-employment to demonstrate income stability. If you have been self-employed for less than two years, your options are more limited - typically low doc or specialist lenders, which carry higher rates.
If you are approaching the end of your second year of self-employment and planning to buy, timing your application after completing your second year of tax returns can significantly expand the number of lenders available to you.
Strategies to maximise your assessed income
Talk to your accountant before you apply. In the year or two before applying for a home loan, it is worth telling your accountant that you plan to borrow, because lenders work from the taxable income on your returns. How your returns are prepared is a decision for you and your accountant, and it involves a trade-off between tax and borrowing capacity.
Lendology can advise on what income level you need to demonstrate to achieve a given borrowing amount, so you and your accountant can plan accordingly.
Which lenders are best for self-employed borrowers?
Not all lenders assess self-employed income the same way. Some are more generous with how they treat add-backs (items deducted from taxable income that can be added back for borrowing assessment purposes, such as depreciation). Some are more flexible about income that has grown significantly from year one to year two.
Lendology works with multiple lenders who specialise in or are particularly accommodating of self-employed applicants. We match your specific income structure to the lender most likely to give you the best outcome.
Frequently asked questions
Can I get a home loan if I have only been self-employed for one year?
Yes, but your options are more limited. Low doc lenders and specialist lenders are typically the path, and rates will be higher. Waiting until you have two years of returns may give you significantly better options.
What if my income has dropped in the second year?
Lenders typically average your income over two years, or use the lower year. If year two is significantly lower, this can affect your borrowing capacity. Some lenders use the most recent year if it is higher and the trend is upward. We identify the lender whose assessment methodology best suits your income pattern.
Can I use business income if it stays in the company?
It depends on the loan structure. If you own the company, the retained profits may be available for assessment as part of your income under certain lending policies. This requires specific documentation and lender expertise. Lendology can advise on whether your business income qualifies.
Find the lenders that will take your income as it is
Lenders treat business income very differently. Jason or Steve will tell you which lenders fit and what they will ask for.
15 minutes with Jason. No cost to you, the lender pays us when your loan settles. You pick a time, we call you.
Rather talk now? Call 08 8270 5138.