ATO debt help for company directors

If your company owes the ATO, you can pay in full, ask for a payment plan, restructure, or wind up. Acting before the ATO issues a director penalty notice keeps the most options open.

If your company owes the ATO, the options narrow the longer it is left. Our registered liquidators help small and medium business directors understand where they stand, what the ATO can do next, and which option fits: a payment plan, a restructure, or an orderly wind-up. We work in English, Mandarin, Cantonese and Korean.

What the ATO can do when tax debt is unpaid

• Director penalty notices (DPNs). Directors can become personally liable for unpaid PAYG withholding, GST and super guarantee charge. Read our director penalty notice guide.
• Bankruptcy. If a director penalty or other personal debt becomes an unpaid court judgment of $10,000 or more, the creditor, including the ATO, can apply for a bankruptcy notice. See our bankruptcy guide.
• Statutory demands. A creditor owed $4,000 or more can serve the company with a demand giving it 21 days. See our statutory demand guide.
• Garnishee notices. The ATO can collect directly from money owed to your company, including bank accounts.
• Credit reporting. The ATO may report a business tax debt to credit reporting bureaus if at least $100,000 is more than 90 days overdue and the business is not engaging with it. It must give 28 days’ written notice first.
• Estimates. If the company does not lodge its returns, the ATO can estimate what it owes, and director penalties can attach to those estimates.

Your options

ATO payment plans

For smaller debts, many businesses can set up a payment plan by contacting the ATO. For larger debts, however, you need to negotiate with the ATO. The ATO will usually want to see that lodgements are up to date and that the plan is realistic. Interest keeps accruing on the unpaid balance. Also, missing an instalment can bring back firmer action. Also, a payment plan does not remit a director penalty the ATO has already issued. ATO payment plans explained.

ATO garnishee notices

A garnishee notice directs a bank or a customer who owes your company money to pay it to the ATO instead. It can arrive with little warning. As a result, it can stop the business paying wages and suppliers. So if you receive one, get advice straight away: options include negotiating with the ATO or, where the business cannot recover, a formal appointment. ATO garnishee notices explained.

Why act early

• Late lodgement removes options. If BAS or super returns are more than three months overdue from the due date, you can only clear a DPN by paying the debt in full.
• General interest charge is no longer tax-deductible from 1 July 2025, so carrying ATO debt costs more than it used to.
• From 1 July 2026, employers must pay super closer to payday. As a result, many businesses lose a buffer they relied on.

How we help

1. Confidential first conversation in your language. We review ATO statements, lodgement status and any notices.
2. Options in writing. What each path means for the company and for you personally.
3. Act within the deadlines. If an appointment is the right step, we can act as administrator, restructuring practitioner or liquidator.

ATO debt guides

• ATO payment plans for businesses
• Can the ATO wind up my company?
• ATO garnishee notices
• Can’t pay your BAS? Unpaid GST and PAYG withholding
• ATO reporting tax debts to credit agencies
• Can ATO debt be reduced?
• Closing or selling a business that owes the ATO
• General interest charge on ATO debt
• What happens to ATO debt in liquidation
• Small business restructuring and ATO debt
• Director penalty notices: the full guide
• ATO departure prohibition orders

Who can help in Sydney and Brisbane

Greengate Advisory is an Australian restructuring and insolvency firm led by registered liquidators. We advise company directors on company ATO debt, including payment arrangements, restructuring and director penalty risk. Our offices are in Sydney (Suite 2, Level 32, 31 Market Street, Sydney NSW 2000, (02) 8318 3699) and Brisbane (Suite 5GB, Level 5, 199 George Street, Brisbane QLD 4000, (07) 3868 1888), and we act for companies across Australia. The first consultation is free and confidential, in English, Mandarin, Cantonese or Korean. Contact us or email info@ggadvisory.com.au.

Common questions

Can the ATO forgive a company’s tax debt?

Rarely. The ATO may remit some interest and penalties, but it generally does not write off a company’s tax debt. A restructuring plan accepted by creditors, including the ATO, can reduce what the company pays. Can ATO debt be reduced?.

Will the ATO report my business debt to credit agencies?

It can, if at least $100,000 is more than 90 days overdue and the business is not engaging with the ATO. You get 28 days’ written notice first. ATO credit reporting explained.

Should I talk to my accountant or a liquidator?

Your accountant is the right first call for lodgements and payment plans. Speak to a registered liquidator when the debt is more than the business can pay from its cash flow, or when a DPN or garnishee notice has arrived.

Example: a Sydney family manufacturer owing about $2.5 million to the ATO was restructured through voluntary administration and a deed of company arrangement. Read the case study.

Speak confidentially with a registered liquidator

Sydney and Brisbane · English, 中文, 한국어

This page is general information, not advice about your situation.