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  • Help with paying

    If you can't pay on time, we can help you.

    You still need to lodge your activity statements and tax returns on time, even if you can't pay by the due date. You'll avoid a penalty for failing to lodge on time and show us that you're aware of your obligations and doing your best to meet them.

    Find out about:

    See also:

    Setting up a payment plan

    Online services

    The easiest way to set up a payment plan is by using our online services, which are available 24 hours a day. You may be eligible to use our online services if you:

    • are an individual or sole trader
    • have an income tax or activity statement debt of $100,000 or less.

    You'll need a myGov account linked to the ATO.

    If you don't already have one, you can create a myGov account in a few simple steps and link to the ATO to access our online services.

    Next step:

    Phone us

    Use our automated phone service to arrange a late payment or pay by instalments, you'll need your tax file number (TFN) or Australian business number (ABN) before you phone.

    Next steps:

    • Use the payment plan estimator to work out a plan that meets your circumstances, taking into account the payment plan conditions and how quickly you can pay off the debt, including how much interest you'll be charged.
    • Phone our automated service to set up the payment plan  
      • for individuals phone 13 28 65
      • for businesses phone 13 72 26If you pay late or enter into a payment plan, you will generally have to pay interest on top of your debt.

    Note: If you can't enter a payment plan through our automated phone service, you’ll be connected to a person who will help you.

    Registered agents

    Registered agents can request a payment plan through the Portal mail in:

    The following information should be included:

    • Topic: Debt and lodgment
    • Subject: Payment arrangement request

    Debts over $100,000

    If your tax debt is more than $100,000, phone us on 13 11 42 during operating hours to discuss your options.

    If you're trying to do the right thing, we're committed to understanding your situation and helping you where possible.

    We may need to know more about your financial situation and your circumstances so we can work with you to set up a payment plan that is manageable and suits both of us. Businesses may need to show that their business is viable.

    Even if you've made a payment plan to pay late or by instalments, interest will accrue on the unpaid debt (small businesses may be eligible for interest-free payment plans for activity statement debts).

    Note: If you default on a payment plan, we may impose stricter requirements before agreeing to a new plan. For example, we may ask for a higher upfront payment or ask that payments are made by direct debit, or both.

    See also:

    Secured payment plan

    If we cannot reach an agreement with you about paying your debt, we may consider accepting an offer of security where you request that we defer the time of payment of a debt, or where you are seeking to pay a debt by instalments.

    Our preferred securities are:

    • a registered mortgage over freehold property, or
    • an unconditional bank guarantee from an Australian bank.

    See also:

    • For further information, you can refer to PS LA 2011/14 General debt collection powers and principles
    • Phone us on 13 11 42 during operating hours

    Disasters and hardship

    Natural disasters

    If you've been affected by a natural disaster, such as a bushfire, storm or flood, we'll work with you to help you sort out your tax affairs when you're ready.

    Next step:

    • Individuals and businesses can phone our business info line on 13 28 66 for assistance.

    See also:

    Hardship

    We may be able to release you from some or all of the debt. If paying your tax debt would cause you serious hardship, for example, you wouldn't be able to provide food and accommodation for you or your family, contact us to discuss your circumstances.

    HELP and SFSS

    If your tax notice of assessment includes a compulsory Higher Education Loan Programme (HELP) or Student Financial Supplement Scheme (SFSS) repayment that would cause serious hardship, or there are other special reasons why you believe you shouldn’t make a compulsory repayment, you can apply to defer it.

    Next step:

    Help for businesses

    There are a number of online resources and services you can use to stay on top of your tax situation:

    Interest-free payment plans for activity statement debts

    If you're a small business with an activity statement debt you may be able to pay it off interest-free over 12 months. You need to have a good history of tax lodgments and payments.

    Next steps:

    • Check your Eligibility.
    • Use the payment plan estimator to work out a suitable payment plan.
    • Phone us on 13 28 66 (8.00am to 6.00pm weekdays) to set up the payment plan.

    Eligibility

    You're eligible for an interest-free payment plan if your business:

    • has an annual turnover of less than $2 million
    • has a recent activity statement debt of $50,000 or less, which has been outstanding overdue for no longer than 12 months
    • has a good payment and lodgment compliance history, including    
      • no more than one payment plan default within the last 12 months
      • no outstanding activity statement lodgments
    • is unable to obtain finance (such as a loan) through normal business channels
    • is able to demonstrate ongoing viability.

    How it works

    You have to agree to a payment plan that allows the debt to be paid by direct debit within 12 months. Even if you receive a letter stating that interest will apply, it will be remitted as long as you maintain your payment plan.

    While you're paying off the debt:

    You must meet all of your other tax payment and lodgment obligations.

    Note: If you default on the plan, the interest-free period will end immediately and the payment plan may also be cancelled.

    If you're already in a payment plan

    You can ask us to change your existing payment plan to an interest-free payment plan if you satisfy the eligibility criteria.

    If your request is approved, we’ll cancel your previous plan. The interest-free period will start from the date you enter into the new plan.

    If your debt is with an external collection agency, you’ll need to negotiate this with them.

    Assessing business viability

    If you're negotiating with us about a debt, we may require you to show that your business is viable. When assessing a business's viability, we look at its ability to pay its debts and meet ongoing commitments. The assessment considers a range of indicators, including:

    • gross margin
    • cash flow
    • asset/liability position (including working capital)
    • liquidity
    • debtor/creditor position
    • availability of funding.

    If you're asked to demonstrate the viability of the business, you'll need to provide the following information within an agreed timeframe:

    • a proposal to pay all amounts owed to us in the shortest possible timeframe, while allowing all future tax obligations to be met by the due date
    • details on how the debt arose
    • steps taken to mitigate the debt (for example, loan applications)
    • the most recent statement for each bank or financial institution account held
    • the following documents for the year to date and the two previous financial years:          
      • detailed profit and loss statement or statement of financial performance
      • detailed balance sheet or statement of financial position
    • details of any overdraft or loan facilities, including term loans, hire purchase and leasing facilities (include the balances owing, the monthly repayment amount for each debt commitment and the limit for overdrafts)
    • aged creditors listing
    • aged debtors listing
    • any other relevant information that may help us assess your proposal.

    Next steps:

    Help for registered agents

    We have the following online resources for registered agents:

    Next step:

    • Registered agents can phone 13 72 86 to discuss their client's situation – use our fast key code guide to work out how to get to the right area.
    Last modified: 17 Nov 2017QC 50299