KDC Accounting

ATO Debt > $100,000? Not in a payment arrangement?

ATO Debt > $100,000? Not in a payment arrangement?

Quick updates you need to know if you are in business:

ATO Debt > $100,000? Not in a payment arrangement?

ATO Debt Credit reporting became law on 28th October 2019.

The Australian Taxation Office can, and will, now disclose the value of any tax debt information of a business to a CRB (Credit Reporting Bureaus) if the taxpayer business meets all of the following criteria:

  • It has an Australian Business Number, and is not an excluded entity,
  • It has one or more tax debts, of which at least $100,000 is overdue by more than 90 days.
  • It is not effectively engaging with the ATO to manage its tax debt, and
  • The Inspector-General of Taxation (IGT) is not considering an ongoing complaint about the proposed reporting of the entity‚Äôs tax debt information.

The ATO will notify the business in writing if they meet the reporting criteria and given them 28 days to engage with them and take action to avoid having their tax debt reported.

The purpose of allowing the ATO to report the tax debt information of a business to CRBs is to:

  • encourage businesses to engage with the ATO to manage their tax debts and, where an business is unable to pay a tax debt in full by the due date, enter a sustainable payment plan that is agreed between the ATO and the business
  • support more informed decision making within the business community by making large overdue tax debts more visible, and
  • reduce the unfair advantage obtained by businesses that do not pay their tax on time and do not engage with the ATO in managing their tax debts

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