The Australian Taxation Office is not just any creditor — failing to pay the ATO can bring legal exposure and a particularly nasty notation on your credit rating. Business leaders should always prioritize tax debt over other, more prosaic debts and expenses. It’s also very important that business owners and managers always maintain granular knowledge of their organization’s financial assets and liabilities. Try to incentivize customers to pay as swiftly as possible. Engage with the ATO early and often if you have or foresee having any difficulty paying your taxes, and try to work with them to establish a payment plan.
- Businesses that do not pay their tax debt would find it difficult to access finance which can be deleterious, especially for growing businesses.
- Businesses have to be at par with their financial situation so that they can be able to meet their tax debts.
- Having a realistic payment plan and budget for controlling tax debts will businesses in the long run.
“Businesses should protect themselves from the potential consequences of unpaid business tax debt by being proactive and acting in a timely and structured manner.”