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  • Businesses with financial difficulties

    Businesses experiencing financial difficulties may qualify for priority processing of their tax return and other concessions or tax breaks.

    By financial difficulties for businesses, we mean difficulty associated with:

    • business closure
    • disconnection of an essential service
    • repossession of a vehicle that is used for business purposes
    • imminent legal action pending for non-payment of debts
    • period of review limitations
    • court orders
    • settlements
    • other necessities for the business or people you are responsible for.

    Evidence of financial difficulty

    To demonstrate that your business is experiencing financial difficulty, we may ask you to provide evidence that supports your claim, such as:

    • a current bank notice
    • bank notices (for example, overdraft call)
    • an eviction notice
    • a disconnection notice
    • a repossession notice
    • a notice of impending legal action
    • staff pay records
    • contract payment schedules
    • legal documents.

    We take many factors into account when assessing your claim for financial difficulty.

    In some cases, these requirements may change, depending on your circumstances.

    Your situation

    Select from the links below for the topics that best reflect your situation:

    Difficulty lodging your activity statement on time

    If you are having difficulty lodging your activity statement, phone us on 13 28 66 before the due date. We can tell you what alternative arrangements may be available in your circumstances.

    See also:

    Priority processing

    If you're experiencing financial difficulty and require priority processing of a refund, phone us on 13 11 42 to discuss your situation.

    See also:

    Concessions for small business operators

    If you're a small business operator, you may be eligible for a range of tax concessions depending on your annual turnover. These are designed to make it easier for you – they include concessions for:

    • goods and services tax (GST)
    • capital gains tax (CGT)
    • fringe benefit tax (FBT)
    • pay as you go (PAYG) instalments.

    If your business is eligible, you can choose to use one or more of the concessions.

    You may have to satisfy additional conditions and, each tax year, check if you still qualify for the concessions.

    See also:

    GST turnover significantly reduced

    If your GST turnover is less than $75,000 (or $150,000 for non-profit organisations), you may be able to either:

    • cancel your GST registration – your fuel tax credit, luxury car tax and wine equalisation tax registrations will also be cancelled
    • remain registered, but report and pay your GST annually
    • continue with your current registration and reporting option.

    See also:

    Trouble paying tax and other business liabilities

    We understand businesses can face cash flow difficulties.

    If you're having difficulties, there are tools and services that can help.

    If you're having trouble meeting your cash obligations, consider restructuring the timing of payments and receipts. The best way to make sure you have cash available to meet liabilities is a cash flow budget.

    For information on how to create a cash flow budget, see Manage your cash flow. You can also arrange for help with managing your business and tax matters – see Supporting your small business.

    If cash flow continues to be an issue, contact your tax or financial adviser.

    If you still have difficulty meeting your tax payments, phone us on 13 11 42 to discuss your circumstances. We can help you understand what options are available in your situation. In some circumstances, we may be able to arrange:

    • more time to pay tax debts without interest charges
    • tailored payment plans
    • remission of general interest charges.

    See also:

    Claiming the tax break for businesses

    Businesses with an annual turnover of $2 million or more can claim either a 30% or 10% tax deduction for investing in new tangible depreciating assets of $10,000 or more, depending on when the investments took place and when the assets were installed.

    The tax break can be claimed in the 2008–09 to 2011–12 income years as a tax deduction – in the income tax return label 'Small business and general business tax break' – for the income year in which the asset is first used or installed ready for use.

    ATO help for small businesses with financial difficulties

    We offer help to viable small businesses that are having trouble meeting their tax payment obligations due to challenging business conditions or unexpected events such as natural disasters.

    Reduced business income

    You may be able to vary your instalment rate if both the following apply:

    • you make pay as you go (PAYG) instalments on your activity statement
    • your business income is reduced substantially part way through the tax year.

    Phone us on 13 28 61 to find out about varying your PAYG instalments.

    See also:

    Difficulty making employee super payments on time

    You need to pay super for all eligible employees at least once every financial quarter, by the 28th day of the month following the end of the quarter. This is the last day you can pay a super contribution to an employee's super fund before you are liable for the super guarantee charge.

    If you do not pay the minimum amount of super to the correct super fund, you need to lodge a Superannuation guarantee charge statement – quarterly form and instructions.

    The super guarantee late payment offset allows you to offset late super contributions against the super guarantee charge for a period.

    At risk of insolvency

    If you suspect your business is in financial difficulty, get proper accounting and legal advice as early as possible.

    There are different types of insolvency administrations, including:

    • administrator appointed (voluntary administration)
    • receivership
    • liquidation
    • mortgagee in possession.

    Action taken against insolvent businesses differs depending on the nature of the insolvency administration. An insolvency practitioner can conduct a solvency review of your business and outline available options.

    To find an insolvency professional, visit the Australian Restructuring Insolvency and Turnaround Association website at Link

    If you're operating a business as an individual and become bankrupt, this will impact your business.

    See also:

    Closing or selling your business

    You may need to deal with a number of tax matters if you decide to:

    • cease operating your business
    • sell your business
    • register a business, but not actually start operating the business.

    These tax matters may include:

    • cancelling your ABN and other registrations
    • lodging and paying any outstanding activity statements or notices
    • making GST adjustments on your final activity statement
    • lodging your final tax returns.

    Phone us on 13 28 66 and we can help work through what you need to do.

    See also:

    Unable to access your frozen funds

    If you're unable to meet your tax payments due to the freezing of income or non-bank funds, phone us on 13 11 42.

    If you can't get access to some funds, you may be able to pay by instalments. Otherwise, you may be eligible for a payment deferral.

    ASIC has provisions for taxpayers who have frozen funds and are experiencing financial difficulties. Contact ASICExternal Link for more information about ASIC facilitates withdrawals from frozen funds.

    Practical help to manage your business

    If you need assistance to manage your business, we can help you better understand your tax obligations.

    Our business support service gives you access to experienced tax officers who can answer your questions and help you get on top of your tax issues.

    We offer:

    • pop-up events at local shopping centres during tax time
    • a range of webinars
    • call-back phone services

    Our business support is free, practical and aimed at keeping your business on track.

    See also:

    Financial advice on managing your business

    We are committed to providing you with advice and information you can rely on about your tax obligations and rights as a business operator. However, we cannot offer financial advice.

    For financial advice, you can contact:

    • a tax agent
    • a financial adviser
    • an accountant
    • a professional association.

    Make sure any advice you receive comes from a licensed financial adviser.

    To check if someone holds the necessary licences, visit the public register at Link

    If you would like to talk to a tax officer about your tax obligations and entitlements as a business operator, phone us on 13 28 66.

    Visit ASIC's website at Link or phone 1300 300 630 for financial tips and safety checks.

    Financial counselling advice

    Financial counsellors provide information, support and advocacy to assist people in financial difficulty. Their services are free, independent and confidential.

    The National Debt Helpline (NDH)External Link is an online and phone financial counselling service available across Australia. The financial counsellors at NDH talk to people with debts and explain what options are available. This may include referral to their local financial counselling service. You can phone the NDH on 1800 007 007.

    If you are a small business owner or sole trader whose business has been affected by the bushfires, call the Small Business Bushfire Financial Counselling Support Line on 1800 413 828 to speak to a financial counsellor.

    See also:

    Last modified: 06 May 2020QC 51702