The ATO’s annual report for the financial year ended 30 June 2024 has shown that Australia’s tax debt has continued to rise.

What are the current total tax debts

 The ATO has reported that:

• Total collectable tax debt now totals $52.9 billion increasing from approximately $50 billion in 2023.

• Total debt (being collectable debt, debt subject to objection/appeal, and debts owed by taxpayers subject to an insolvency event) now totals $86.1 billion having increased from $77.4 billion in 2023.
• Debts owed by taxpayers subject to an insolvency event has increased to $14.3 billion from $11.3 billion in 2023, being an increase of 26.5%.

What are the ATO doing to recover unpaid tax debts

The ATO’s annual report also advised that:

• The ATO is taking firmer recovery action to ensure that businesses manage their cash flow to pay amounts withheld on behalf of others – GST, PAYG withholding and superannuation for their employees. We also take firmer action where we detect deliberate non-compliance and phoenix activities.
• The ATO issued 26,702 Director Penalty Notices to company directors in the 2024 financial year.
• The ATO was issuing Garnishee Notices to recover tax and SGC debts.
• The ATO had reported over 36,000 business tax debts to credit reporting bureaus in the 2024 financial year.

It is therefore clear that the ATO is increasing the amount of action it is taking to seek to recover the ever increasing amount of tax owed.  This poses a risk to companies and their directors which Tax Debt Solved can assist with.

How Tax Debt Solved can help

If you or your company owe a tax debt there is now more of a risk than ever that the ATO will take recovery action to recover debts owed.

You should therefore seek professional advice urgently from Tax Debt Solved and discuss the options available. Some of the options that are available include:

• Taking advantage of the small business restructuring scheme. This scheme is a cost-effective way of dealing with your company’s tax debts, while allowing you to continue trading.
• Negotiating a payment arrangement, which will halt any recovery action being taken by the ATO.
• If your business is no longer viable, the last resort would be liquidation.

Acting now will help minimise or avoid the risk of ATO recovery action.

How we can help

The team in TAX DEBT SOLVED have decades of experience in helping clients with tax debts. We understand implications of all the options available to you and your company, including any risks associated with those options.