Hiring before the revenue arrives: funding a new role without property

Why does hiring create a cash gap?

Because the costs start on day one and the benefits arrive later. A new employee needs to be recruited, equipped, trained and paid, often for several weeks before they’re working at full capacity. Meanwhile, the revenue they’ll help generate may not land in the account until invoices are paid.

For a business without property, that ramp-up gap is exactly where unsecured funding is useful. It bridges the period between committing to a hire and the hire paying for themselves.

What does a new hire really cost upfront?

Build a simple list before you decide how much to borrow:

Cost	Notes
Wages during ramp-up	Gross pay for the weeks before the role is self-funding
Super guarantee	The ATO lists the rate as 12% for 2025–26 and 2026–27
Workers compensation insurance	Required in every state and territory
Payroll tax	Only if total wages exceed your state’s threshold
Equipment and tools	Laptop, vehicle, uniform, PPE, licences
Recruitment	Advertising, agency fees, checks
Training	Time from existing staff, courses

The ramp-up length is the biggest variable. Be conservative. If you think a role will pay for itself in eight weeks, plan for twelve.

How does payday super change the timing?

From 1 July 2026, the ATO’s payday super rules mean a contribution is on time if it’s received by the employee’s super fund within 7 business days after paying the employee, with longer windows in some situations, such as a first contribution for a new employee. Super is no longer a quarterly lump; it goes out with every pay run.

For cash flow, that means a new hire costs wages plus super every pay cycle from the start. Businesses that used to rely on the quarterly gap before paying super will feel the difference. Factor it into your ramp-up calculation.

Which funding structure fits a hire?

Situation	Better fit
Ramp-up cost is gradual and uncertain	Line of credit: draw each pay cycle as needed
Hire tied to a new contract with known payment dates	Short unsecured loan or invoice finance
Several hires for a seasonal peak	Line of credit or merchant cash advance for card-heavy businesses
Hire needs a vehicle or major equipment	Equipment finance for the asset, unsecured for wages

A line of credit often suits hiring best, because you only draw what the ramp-up actually needs, and you stop drawing once the hire is earning their keep.

If you’re weighing up a hire, tell us about it and a specialist will help you size the gap.

What will a lender want to see?

• Business bank statements showing current turnover and wage payments.
• A short explanation of why the hire will lift revenue: a new contract, a waiting list, turned-away work.
• Existing commitments, including any ATO plan.
• How the business will cover the role if revenue takes longer to arrive.

business.gov.au encourages staying flexible with employment options and matching staffing to peak periods. Lenders appreciate owners who’ve thought about flexibility too, for example by starting with part-time hours or a fixed-term contract.

How do you avoid over-borrowing for a hire?

1. Borrow for the ramp-up, not the year. After the ramp-up, the role should fund itself.
2. Set a review date. If the hire isn’t covering costs by then, adjust.
3. Keep BAS money separate. More wages means more PAYG withholding. See our BAS page.
4. Check your indicative capacity with the borrowing estimator.

A worked example (illustrative)

A plumbing business with two vans and a leased workshop is turning away about three jobs a week. The owner wants to hire a qualified plumber and estimates ten weeks before the new role fully covers wages, super, a van lease and tools.

A line of credit could be drawn each fortnight during the ramp-up, while the van goes on equipment finance. Once the new plumber’s jobs are being invoiced and paid, the line of credit is repaid. The figures would come from the business’s own statements; this example is illustrative.

How do you estimate the ramp-up period?

The ramp-up is the heart of the funding question, and most owners underestimate it. Think through:

• Recruitment time: how long before the person actually starts?
• Training time: how many weeks before they work independently?
• Workload build-up: is the work already waiting, or will it take time to win?
• Billing lag: once they’re productive, how long until their work is invoiced and paid?

Add those together, then add a margin. A role that looks self-funding in six weeks on paper may take ten in practice once billing lag is included. That longer figure is the one to fund.

Owners with a backlog of turned-away work tend to ramp up fastest, because demand already exists. Owners hiring ahead of demand should be more conservative and consider part-time or fixed-term arrangements first.

Ready to grow the team?

Hiring is one of the best reasons to borrow if the work is there. Tell us about the role and the plan. No credit check happens when you first enquire, your details aren’t parcelled out to a list of lenders, and a real person helps you work out how much you actually need.

Please be accurate with turnover, current wages and existing debts on the form. The real figures show how long a ramp-up the business can carry. Check your options.