Starting from 1 July 2017, the Australian Taxation Office (ATO) will have the authority to share tax debt information with Credit Reporting Bureaus. This recent provision will specifically impact businesses holding an Australian Business Number (ABN) with a tax debt exceeding $10,000, which has been outstanding for over 90 days. However, this disclosure will only occur if the taxpayer has not taken appropriate steps to address the debt, such as establishing a payment arrangement or engaging with a tax accountant to manage their financial obligations effectively.
A tainted credit history can make financing a small business extremely difficult, and an overdue account can remain on your file for up to 5 years.
To avoid being impacted by these new measures, you should:
- Undertake tax planning regularly to ensure you are aware of upcoming tax debts well before they fall due.
- Maintain up-to-date cash flow forecasts to consider your tax obligations, allowing you to seek finance where required in a timely fashion.
- If you find yourself unable to make your tax payment on time, be sure to negotiate an agreeable payment arrangement with the ATO to avoid the debt being reported.
Our team at S & W can help with any of the above, so please get in touch with your client manager if you have any concerns about the new rules.
Kreston Stanley Williamson Team
*Correct as of February 2017
Disclaimer – Kreston Stanley Williamson has produced this article to serve its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas in this article, you must seek advice about your circumstances. Liability is limited by a scheme approved under professional standards legislation.
