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  • New insolvency reforms to support small business

    The Australian Government has made changes to our insolvency frameworkExternal Link to help more small businesses restructure and survive the economic impact of COVID-19.

    Where restructuring is not possible, businesses will be able to wind up faster, enabling greater returns for creditors and employees.

    Two new processes are available for small businesses from 1 January 2021:

    • a simplified liquidation framework
    • a small business restructuring plan.

    Eligibility

    The new processes are available to incorporated businesses with liabilities of less than $1 million:

    • simplified liquidation – you must have all your lodgments up to date to be eligible
    • restructuring – before providing a restructuring plan to creditors you must have
      • paid all employee entitlements that are due and payable (including superannuation)
      • your tax lodgments up to date (or at least been 'substantially complying' with this requirement).
       

    You can view your lodgement information in Online services for business.

    What practitioners need to do

    From 1 January 2021, you can notify us of the proposed plan with supporting documents by either:

    New subject selections are available for both:

    • simplified liquidation
    • SB restructuring.

    Next step:

    See also:

    Last modified: 23 Apr 2021QC 64484