Ute vs Van for Tradies — Which One Is Better for Finance, Tax & Running Costs?

Ute vs van finance comparison for Australian tradies – Switchboard Finance

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TRADIES • UTE VS VAN • 2025

Ute vs Van for Tradies — Which One Is Better for Finance, Tax & Running Costs?

Updated for 2025 · Works with low doc and full doc approvals

If you’re a tradie choosing your next work vehicle, the big question always comes up: “Should I get a ute or a van — which one is better for finance, tax and the day-to-day?”

Both can be perfect depending on your trade, equipment and the type of work you take on. But there are clear differences in running costs, loan approvals, storage and ATO treatment that most tradies never consider.

This 2025 guide breaks it all down using real-world lending rules and simple examples. For the bigger picture on borrowing, you can pair this with our Tradie Finance Australia guide and the tools inside the Tradie Hub.

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Ute vs van — quick comparison for tradies

Here’s the simple side-by-side before we go deeper into finance, tax and cash flow.

Feature	Ute	Van
Storage & tools	Open tray, canopy options	Fully enclosed, weather-proof
Finance approval	Very strong lender appetite	Strong, but varies by model
Running costs	Generally higher	More fuel-efficient
Tax benefits	Can be FBT-exempt for tradies	FBT-exempt if primarily work-use
Best for	Construction, landscaping, heavy gear	Sparkies, plumbers, mobile services

Quick rule of thumb: if you’re hauling messy or bulky loads, a ute usually wins. If you live out of the back of the vehicle and need tidy shelves and lock-up space, a van usually wins.

Example Landscaper → ute with trailer. Mobile electrician → van with racking.

Why utes are popular for tradie finance in 2025

Utes remain the #1 financed tradie vehicle because lenders love them as a Vehicle Finance asset class:

• High resale value (low lender risk).
• Wide lending appetite across low doc and full doc.
• Simple asset valuation for approvals.
• Strong tax position when mainly used for work.

This often means faster approvals — especially for ABN-only and low doc deals that sit under your broader Asset Finance plan. For approval ranges by income and ABN age, see our Tradie Borrowing Power Guide.

Example Carpenter with 3+ years on ABN, clean statements and property backing can usually get a solid work ute approved quickly under low doc, then look at tools or a second vehicle later.

Why vans are becoming more popular

Vans are winning more tradies over because they offer something utes can’t:

Fully enclosed, weather-proof tool protection.

• Massive storage space with shelving and drawers.
• Better fuel efficiency for metro driving.
• Lower running costs in many cases.
• Clean, professional look for service businesses.

Electricians, plumbers and mobile service tradies are choosing vans more often every year, especially when they pair the vehicle with a simple business buffer from our Business Loans options so cash flow isn’t tight between jobs.

Example A plumber who swapped from a dual-cab to a mid-size van cut time spent hunting for fittings, reduced fuel and stopped losing small parts in the tray — the van upgrade paid for itself in extra jobs.

Finance: which is easier to get approved?

Utes win this one most of the time.

Why lenders like utes:

• Thousands of comparable sales → easy valuation.
• High resale value → lower risk for the lender.
• Huge demand from tradies → very familiar asset.

But vans still get strong approvals — especially models like HiAce, Transit, iLoad and Transporter. These sit as “core work vehicles” in many Low Doc Vehicle Finance policies and standard Chattel Mortgage structures.

For typical documentation and lender settings, check our Vehicle Finance page and the deeper tradie content in Tradie Finance Australia.

Example A sparky with a small van and good conduct on existing loans can often upgrade into a newer van or ute using clean bank statements and trading history, even before full financials are ready.

Load space & storage: which one wins?

This part is simple: match the vehicle to the work you actually do most days.

Ute wins for:

• Oversized tools and long loads (timber, ladders, mesh).
• Landscaping materials and messy loads.
• Regular trailers and towing.

Van wins for:

• Organised tool storage and racking.
• Electronics and delicate gear.
• Plumbing and electrical supplies.
• Lockable, weather-proof storage.

If security and organisation matter more, vans win. If load flexibility matters more, utes win. Some growing crews eventually run one of each as the business scales out of the Business Owners Finance Hub playbook.

Example Many small teams start with one dual-cab ute, then add a van when they put on an apprentice who handles service and maintenance jobs.

Tax differences (important for EOFY planning)

Both utes and vans have strong tax benefits when used primarily for work. The ATO outlines the rules on ato.gov.au, and your accountant should always give the final word.

Utes

• Often FBT-exempt for tradies when private use is limited.
• Clear ATO classification as commercial vehicles.
• Work well with instant asset write-off when active.

Vans

• Also FBT-exempt when used primarily for work.
• Good deduction potential for interior fit-outs.
• Easy to show as “work-use” if it never leaves job mode.

For deeper EOFY strategy, including how GST and deductions work alongside your other gear, see our EOFY Vehicle Upgrade Guide.

Example A tradie might finance a ute now and plan a fit-out or second vehicle the following year, spreading deductions instead of doing everything in one go.

Running costs: which one is cheaper?

On average, it shakes out like this:

• Utes cost more to run (fuel, tyres, accessories).
• Vans are more economical, especially for metro tradies.

The bigger question is:

Does the vehicle help you earn more money?

Think about total monthly cost, not just the repayment: fuel, insurance, rego and regular servicing. This is where basic cost planning for OPEX helps you avoid nasty surprises.

Example A “cheaper” second-hand ute that drinks fuel and needs constant repairs can cost more per month than a newer van with a slightly higher repayment but lower running costs.

Finance repayments: which one is better for cash flow?

Repayments vary by year, make, model, ABN age, low doc vs full doc and the structure you choose. A key lever is whether you run a straight term loan or add a Balloon Payment at the end.

• Vans are often cheaper weekly because of lower purchase price.
• Utes can attract higher approvals thanks to stronger resale.

For exact numbers, we usually pair your vehicle scenario with what’s possible on the Business Loans side and your other Low Doc Asset Finance needs, then give you a simple payment range instead of guessing.

To explore your fit in a couple of minutes, start with Check Eligibility or read the full Low Doc Vehicle Finance Guide.

Example Two utes with the same drive-away price can have very different repayments depending on term length, balloon and lender — which is why we model it before you sign.

What other tradies are reading today

• How Much Can Tradies Borrow in 2025?
• The Tradie Cash Flow Trap
• Top 5 Tools Most Tradies Finance First
• Tradie Finance Australia

Talk to a Broker About Your Next Ute or Van Check Eligibility in 2 Minutes

This guide is general in nature and doesn’t take into account your full financial situation. Always chat with your accountant and a broker before committing to any finance.

FAQ

Are utes or vans easier to finance?

Utes are generally easier because they have stronger resale value and very clear work use, but top-tier trade vans are also straightforward to finance when your profile fits the lender’s policy.

Which one is better for tax?

Both can be strong options when used mainly for work. The right choice depends on your setup, business structure and advice from your accountant, not just whether it’s a ute or a van.

Which is cheaper to run?

Vans usually win on fuel and day-to-day costs, while utes can cost more in tyres, fuel and accessories. The “better” option is the one that still makes sense once you add repayments and running costs together.

Can I get a low doc loan for both?

Yes. Both utes and vans are eligible under many low doc policies for established ABNs. The detail is in how long you’ve been trading, your bank statements and how the vehicle fits your work.

Where should I start if I’m still not sure?

Start by looking at your week: what you carry, where you park and how many jobs you want to fit in. Then use Check Eligibility or reach out via the Talk to a Broker page and we’ll map out what the numbers look like on each option.