What Business Owners Need to Know Before Locking in a Repayment Deal that Could do More Harm than Good
If you’re behind on tax, you’re not alone — and it’s more common than most business owners think. When the pressure builds and the ATO starts sending payment demands, it’s easy to say yes to the first option they offer: a payment plan.
But while an ATO payment plan might seem like a helpful fix, it isn’t always the most sustainable long-term solution — especially if cash is already tight.
At de Jonge Read®, we’ve helped thousands of business owners in your shoes find better, more realistic ways to deal with tax debt — without sending their business into more financial stress.
The Problem With ATO Payment Plans
Yes, ATO payment plans can give short-term relief by breaking your debt into smaller instalments — but here’s what they don’t always tell you:
The interest adds up fast
The ATO charges daily interest on what you owe. That means even with a payment plan, your debt can quietly keep growing.
And from 1 July 2025, interest charged by the ATO — known as General Interest Charges (GIC) and Shortfall Interest Charges (SIC) — will no longer be tax deductible.
This change will make payment plans even more expensive and harder to justify for many business owners.
It can hurt your cash flow
You’ll need to keep up with regular payments on top of your day-to-day business costs — and that can make it even harder to stay afloat.
If you miss a payment, it gets serious quickly
One missed instalment can trigger legal action, garnishee notices, or even directors becoming personally liable for company debts.
This can leave you stuck — locked into an agreement that’s hard to maintain, and with fewer options available if it doesn’t work out.
There May Be a Better Way: The Small Business Restructure (SBR)
If your business has under $1 million in total debts (including tax), the Small Business Restructuring (SBR) process could offer a better way forward.
This formal process gives you the chance to:
- Reduce what you owe through a negotiated agreement
- Keep control of your business while the restructure takes place
- Pause legal action so you have time to plan
- Create repayments that reflect what your business can actually manage
And unlike an ATO plan, an SBR takes all your debts into account — not just tax debt.
We’re Here to Help You Choose the Right Path
Every business is different — and what works for one might not work for another.
While they seem easy and are popular right now, an SBR isn’t the best option for everyone. We help work through your situation and determine whether it is an SBR or another strategy that will provide you with the best outcome.
That’s where we come in.
At de Jonge Read®, we’ll help you:
- Understand all your options — not just the ones the ATO suggests
- Review your financial position clearly and honestly
- Put a real plan in place to deal with debt and move forward
We don’t work for the ATO nor your creditors. We work for you — to get the best outcome possible for your business, your family, and your future.
If You’re Under Pressure, Let’s Talk
You don’t need to wait until things get worse.
If you’ve already set up an ATO payment plan that’s becoming hard to manage — or you’re thinking of starting one — let’s have a quick, confidential chat before you lock anything in.
Call our team today at de Jonge Read® today and we’ll help you figure out the right way forward, with honest advice and a clear plan.
Did you know?
Phoenixing is another name of business restructure. Read more about business restructures and when this can be an option for you.
