ATO Credit Reporting for SME Tax Debt

ATO are stepping up their efforts in collecting outstanding debts.

Businesses of varying size and industry all have challenges. One of these is maintaining taxation obligations on a timely basis.


From July 2023, the ATO started to follow through in its powers for disclosing overdue debts to credit reporting agencies. Around 22,000 businesses with a tax debt of at least $100,000 have been notified of the pending disclosure.

From this process, more than 9,000 businesses are expected to have their debts disclosed during 2023.  The ATO expects to issue around 50,000 disclosure intent notices by the end of 2023–24 financial year. 

Disclosure of business tax debts

The ATO has the ability to report tax debt where the following criteria applies:

- The business has an ABN and is not an excluded entity;
- The debt is $100,000 or more and is overdue by more than 90 days;
- There are no ATO payment arrangements in place to manage your tax debt; and
- There are no current Inspector-General of Taxation Ombudsman (IGTO) dealings.

Once a Notice of Intent is issued, a business will need to pay their debt or enter into an appropriate payment arrangement within 28 days to prevent disclosure.

A disclosed debt can impact a business’s ability to maintain a fluid financial arrangements with lenders and suppliers alike.

Managing Tax Obligations

It can seem convenient or easy to use the ATO as a bank facility, though for a number of reasons related to solvency and credit, it is important to be up to date with tax obligations. 

Tax arrears are often the cause of a lack of planning and failure to understand the cycle of your business cashflow. Sure, there can be unexpected events (such as bad debts or inventory delays) but in our experience basic cashflow planning can eradicate or prepare for these issues.

Talk to your adviser or accountant around how to better understand the cycle of your cashflow. There may be opportunity to improve or at least plan for it.

If you have a dispute or are having trouble in meeting commitments, there are useful ATO resources available at the link below.

As a general rule - it is always better to keep the lines of communication open with the ATO, as they take the view that bad news is better than no news. An alternative strategy is to speak to your accountant or legal team for support or advice in acting on your behalf.

Managing ATO Business Tax Debt


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