The ATO has largely put its recovery efforts on hold for the larger part of the Covid-19 pandemic. With businesses struggling to stay afloat even with JobKeeper, some business have been accruing tax debts which they cannot reasonable pay. As a result, the ATO has racked up $53 billion worth of unpaid taxes, up from $45 billion from just one year ago.

Now that JobKeeper has ended, the ATO has indicated that it will resume its efforts to recover tax debts. The ATO has been sending taxpayers letters in an effort to warn them of potential action against them if they fail to keep up with their tax obligations, including imposing penalties.

Not all of this is bad news, however. The ATO understands the predicament of business owners during these trying times. If you have received one of these letters from the ATO or you have a tax debt you can’t immediately pay, don’t just do nothing. The ATO is still as lenient as ever and all they want is for taxpayers to try to do the right thing. So, engage with the ATO and discuss your circumstances with them and try to enter into a payment arrangement. If you do not know how to approach the subject with the ATO, speak to your accountant. They will be able to assist you in dealing with the ATO.  And, if your accountant can’t help, give us a call.

Contact us for assistance

If you or you business has significant tax debts and are unable to keep up with payments, contact us at TAX DEBT SOLVED for a free confidential discussion about your circumstances.

Depending on your circumstances, we may be able to assist you in negotiating a payment arrangement with the ATO. It is now the time to take action to avoid bankruptcy or liquidation.