The Australian Taxation Office (ATO) can issue a Garnishee Notice to a third party that may be liable to pay money to a company or which holds money on behalf of the company.

Garnishee Notices are commonly issued to:

  • Banks who hold money on behalf of a company, requiring the bank to pay all or a percentage of funds held in the company’s bank accounts to the ATO, up to the amount of the company’s tax debt;
  • Debtors who owe money to a company, requiring the debtors to pay debts owed to the ATO;
  • For property development companies, parties who have entered into contracts to purchase real property requiring them to pay the purchase price for a property to the ATO; and
  • A company’s solicitors who may hold funds on trust on behalf of a company requiring them to pay funds held to the ATO.

How to Minimise the Risks of Garnishee Notices

If you are a director of a company and you genuinely want to deal with your company’s financial problems, including tax debts then you should:

  • Urgently obtain advice and assistance from a qualified professional;
  • Negotiate a payment arrangement with the ATO. The ATO generally won’t issue a garnishee notice if they believe a payment arrangement is being negotiated in good faith, and they won’t issue a garnishee notice if a payment arrangement is in place and being complied with;
  • Consider what information is being provided to the ATO in order to negotiate a payment arrangement. For example, if a list of a company’s debtors is provided to the ATO and then the ATO refuses a payment arrangement, the ATO will then be able to issue garnishee notices to the company’s known debtors;
  • Be aware that if it is operating a bank account that holds credit funds in it, the ATO may issue a Garnishee Notice to the bank; or
  • Appoint a liquidator or voluntary administrator if it is ultimately unable to pay its debts including its debts to the ATO.

Advice and Assistance Regarding Garnishee Notices

Given the serious effects which Garnishee Notices may have, if your company has received a Garnishee Notice or if it has a tax debt it is unable to pay, you should urgently obtain appropriate advice and assistance.

If you would like us to assist you, please don’t hesitate to contact us for an initial no obligation free consultation.


If you have a tax debt , you should urgently obtain professional advice and assistance.  This will help you avoid ATO recovery action.

We can assist you deal with your tax debt problems.  So, please call us for an initial no obligation free consultation.

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