Facing ATO Tax Debt can feel overwhelming, but it doesn’t have to stop your business in its tracks. The key is to act early, explore your options, and put the right structures in place to move forward with confidence. At Matthews Steer, our Business Tax Accountants in Essendon help business owners navigate tax debt challenges by providing clear guidance and tailored solutions.
If your business is struggling to meet tax obligations, there are several avenues available to help restructure, protect your assets, and create a sustainable plan for the future.
Restructuring Your Business to Manage ATO Tax Debt
Restructuring can be an effective way to manage ATO Business Tax Debt while protecting your core operations. In this process, the businesses of the companies are sold at market value to new entities, supported by formal valuations of physical assets, goodwill, and intellectual property.
It’s essential that restructures are properly documented, supported by valuations, and managed with precision. This ensures any future review by administrators or liquidators can be navigated without complications. Security interests registered against the company also need to be released appropriately to avoid unintended consequences.
A new entity will need to pay a fair commercial price for the assets, but options such as vendor finance agreements can provide flexibility in managing settlement. With Matthews Steer’s systems and support, ownership changes can be seamless, with minimal disruption to trading.
Restructuring also allows business owners to take a proactive approach by keeping the business alive, preserving jobs, and retaining valuable customer relationships. When carried out correctly, it provides breathing space to reset and move forward with a stronger foundation.
Once restructuring is complete, we generally recommend finalising the affairs of the old companies through liquidation, ensuring a clean break and a stronger platform for future growth.
Liquidation as an Option for ATO Tax Debt
In some cases, liquidation may be the most practical solution for managing ATO Tax Debt. This process means that company debts remain with the business, and directors are generally not personally liable unless personal guarantees or specific exceptions apply.
Although liquidation can feel daunting, it provides clarity and a structured resolution. It brings finality to outstanding obligations, prevents further creditor pressure, and allows directors to move forward without the ongoing stress of unresolved liabilities.
Directors will need to supply information and records to the liquidator, and Matthews Steer can guide you through this process, ensuring compliance with your duties and minimising risks. Our role is to make the process as straightforward as possible, giving you confidence that obligations are being handled properly and transparently.
Handled properly, liquidation offers finality, protects directors from ongoing creditor pressure, and allows you to focus on the next stage of your business or personal journey.
Voluntary Administration and Deed of Company Arrangement (DOCA)
If you want your company to continue trading while managing ATO Tax Debt, voluntary administration leading to a Deed of Company Arrangement (DOCA) may be the right approach.
A DOCA is a binding agreement between a company and its unsecured creditors, preventing them from taking further action and giving directors space to implement a business plan. This option allows you to stay in control, manage creditors fairly, and avoid the uncertainty of aggressive recovery actions.
Unlike liquidation, a DOCA provides greater certainty and flexibility, allowing you to focus on restructuring and rebuilding with a clear strategy for success.
Take Control of Your ATO Tax Debt
At Matthews Steer, our experienced team supports businesses across Melbourne Metro and Outer Metro, including Geelong, Ballarat, and Bendigo. Our advisors work alongside you to find the right solution whether restructuring, liquidation, or a DOCA and guide you through the process with clarity and confidence.
Partner and Chief Financial Officer, Nidal Mazloum combines expertise in tax accountancy with a passion for business advisory. With extensive experience in strategic planning and business analysis, he helps businesses restructure effectively, manage ATO Tax Debt, and build sustainable strategies for long-term success.
Don’t let ATO Tax Debt hold your business back. Contact our Business Tax Accountants in Essendon at Matthews Steer today on 03 9325 6300 to discuss your options and take the next step towards financial certainty.