Managing ATO Tax Debt

At one time or another, a small business can find themselves in a tight cashflow position. A common problem that arises from cashflow issues is getting behind with ATO payments. This can be an accumulation of BAS, Tax, PAYG amounts, penalties and interest.

At CBW Accounting, we are here to minimise stress around finance and can assist with liaising with the ATO around Tax debt.

Here’s our top 5 tips in managing ATO Tax Debt

1. Communication is Key

   If you receive a phone call from the ATO, let them know you are experiencing financial difficulties. Advise the ATO that you will come back to them after you have spoken to your Accountant. If you haven’t received a phone call from the ATO, head to step 2.

2. Talk to Your Accountant

   We’re here to help and want to make sure you’re not stressing about your debt. We will be able to advise you the breakdown of the total outstanding and help you build a payment plan that is timely, manageable and achievable.

3. Review your financial situation with your Accountant.

   These are questions we will discuss with you to make a clear plan.

   • Are you able to make a lump sum payment?

   • How much can you afford to pay the ATO weekly or monthly?

   • Do you have any assets that you could sell in order to make a payment to the ATO?

   • The ATO may also require financial information from you if you are looking at entering into a payment arrangement. This will include your assets, liabilities and income and expenses information. This financial information will be for both business and personal.

4. Contact the ATO’s debt recovery area

   Once you have gathered the information required from your accountant, either you or your Accountant need to contact the ATO’s debt recovery area to discuss repayment.

5. Plan ahead and Pay on time

   Ensure that you lodge and pay any future BAS and Tax on time. If you are late with either lodgement or payment, any payment arrangement you have will be cancelled. This is also the case if you are late on a payment for the payment arrangement.

We’re here to help

If you’ve found yourself in this situation, remember that you will be okay! With the help and guidance from the team at CBW Accounting, we will ensure that this situation is only temporary.