Quick answer
An accountant's letter is a short signed statement from your registered tax agent or accountant that confirms facts a lender would normally take from tax returns or financials, such as income figures, the status of outstanding lodgements or add-backs. It's most useful as a bridge while formal paperwork is being prepared, and works best when it confirms only what the accountant can verify.
Key points
- The letter lends the accountant's credibility to figures you can't yet document formally.
- It should confirm facts, not give opinions about whether you can afford the loan.
- Lenders prefer letters from registered tax agents; check the TPB Register.
- Pair it with bank statements or BAS so the figures can be cross-checked.
What job does an accountant’s letter do?
Think of it as borrowed credibility. When you tell a lender your business turned over $600,000 last year, that’s a claim. When your registered tax agent confirms it on letterhead, it’s a verified fact from a professional with their registration on the line.
In low doc lending, the letter usually does one of three jobs:
- Bridges a missing tax return, by confirming income figures from the books while the return is prepared.
- Explains overdue lodgements, by listing what’s outstanding and when it will be lodged.
- Clarifies a low taxable profit, by setting out add-backs such as depreciation or one-off costs.
What should the letter confirm?
The best letters are short and factual. Lenders read a lot of them, and plain ones earn more trust than enthusiastic ones.
| Include | Leave out |
|---|---|
| How long they’ve acted for you and your entity | Opinions about your character |
| Turnover and, if possible, net profit for the period | Statements that you “can afford” the loan |
| Which returns and BAS are lodged and which are outstanding | Figures they haven’t checked |
| An estimate of any tax payable on outstanding lodgements | Promises about future trading |
| Add-backs, with amounts and reasons | Marketing language |
| Their registration details, signature and date | Anything the lender can’t verify |
Some lenders have their own template, sometimes called an accountant’s declaration. If yours does, use it. If not, a letter on the practice’s letterhead covering the points above works well.
Who can write it?
Lenders prefer letters from a registered tax agent, particularly one who prepares your returns. A registered BAS agent can often confirm BAS-related figures. The Tax Practitioners Board encourages people to check a practitioner is registered using the TPB Register, and registered practitioners can display a symbol showing their registration type and number.
A letter from a bookkeeper who isn’t registered, or from a friend with an accounting degree, carries much less weight.
Illustrative example: return in progress, letter as bridge
Illustrative only; not a real business.
A physiotherapy practice company needs $90,000 to fit out a second treatment room. Its latest company return hasn’t been lodged; the practice’s tax agent is finishing it. The director asks the agent for a letter.
The letter confirms the agent has acted for the company for five years, states turnover for the last financial year from the finalised books, confirms all BAS are lodged and up to date, and gives an expected date for lodging the return. Paired with twelve months of bank statements, it lets a lender assess now, with the lodged return to follow.
How do you ask for one without delays?
- Be specific. Tell your accountant exactly what the lender needs confirmed. “A letter for the bank” leads to back-and-forth.
- Give them time. A few business days is reasonable. Don’t ask the day before settlement.
- Ask about cost upfront. Many practices charge for letters.
- Accept their limits. If they won’t confirm something, don’t push. Find a different piece of evidence instead.
If your returns are behind, the ATO says engaging a registered tax or BAS agent can give you a later lodgement due date. That can change a return from “overdue” to “not yet due”, which is worth including in the letter. See our guide to showing returns are in progress.
When is a letter not enough?
A letter is supporting evidence. Lenders will usually want at least one independent source alongside it:
- business bank statements for the same period;
- lodged BAS;
- or property security, which reduces the reliance on income evidence.
For larger unsecured amounts, some lenders will set the lodged tax return as a condition to be met before or shortly after funding.
No accountant? You still have options
Not everyone has an accountant who’ll write a letter. That’s fine. Our page on borrowing without an accountant covers the evidence you can gather yourself, and the substitute checker shows how it lines up.
A simple letter structure lenders recognise
If your accountant asks what you need, you can suggest this outline. It keeps the letter short and within what they can confirm:
- Opening. “We act as registered tax agent for [entity], ABN [number], and have done since [year].”
- Figures. “Based on the finalised books for the year ended 30 June, turnover was approximately $[x] and net profit before tax approximately $[y].” If the books aren’t finalised, they may prefer to confirm BAS turnover instead.
- Lodgement status. “All activity statements are lodged to [quarter]. The income tax return for [year] is in preparation, with lodgement expected by [month].”
- Tax position. “We estimate tax payable of approximately $[z] on lodgement” or “we don’t expect a material liability.”
- Add-backs, if relevant, with amounts.
- Sign-off with name, practice, registration number and date.
Illustrative outline only; your accountant will use their own wording and may limit what they confirm.
A letter like this often takes less than an hour to prepare when the books are in order, which makes it one of the most time-efficient pieces of evidence you can get.
Ready when your letter is
Whether you have a letter in hand or are still asking, start your enquiry and we’ll tell you whether a letter will help with the lenders that suit you. There’s no credit check when you first enquire, and your details go to one specialist rather than a list of lenders.
Be accurate about what’s lodged and what isn’t when you fill in the form. It means we can tell you exactly what to ask your accountant for. Start now.
Frequently asked questions
Who can write the letter?
Usually the registered tax agent or accountant who prepares your returns or BAS. Some lenders accept a registered BAS agent for BAS-related figures. You can check registration on the Tax Practitioners Board Register.
Will my accountant charge for it?
Many do, since it takes their time and carries their name. Ask upfront. A short, factual letter shouldn't be a large job.
Can the letter say I can afford the repayments?
Most accountants won't state that, and lenders don't expect them to. The letter should confirm facts; the lender makes the affordability assessment.
What if my accountant won't write one?
It's their professional call. You can still apply using bank statements, BAS and ATO records, which many low doc lenders accept without a letter.
Does an accountant's letter replace tax returns completely?
For some lenders, alongside bank statements, it's enough. For others it's a temporary bridge, with the returns to follow as a condition of the loan.