It happens. A slow quarter, a lost contract, or a payroll error, and suddenly you have a debt with the Australian Taxation Office (ATO).
In 2026, the ATO has shifted gears. They are no longer the "lenient lender of last resort." They are aggressively issuing Director Penalty Notices (DPNs) which make directors personally liable for company tax debts, and they are disclosing tax debts to credit bureaus, which destroys your credit rating.
The Problem with ATO Payment Plans
While the ATO offers payment plans, the General Interest Charge (GIC) is high (often 11%+), and the interest is not tax-deductible. Furthermore, the plans are rigid. Miss one payment, and the arrangement defaults, triggering legal action.
The Refinance Solution
A strategic move is to take out a specialized business loan specifically to pay out the ATO.
- Tax Deductible Interest: Unlike the ATO GIC, the interest on a commercial business loan is generally tax-deductible.
- Negotiation Leverage: If you can offer the ATO a lump sum payment (via the loan), they may agree to remit (waive) tens of thousands of dollars in accrued interest penalties.
- Clean Credit: Paying the debt clears your tax portal. You are no longer "in arrears," protecting your credit score and ability to trade.
Don't let the tax man dictate your future. Get in touch now to look at a facility to clear the slate and sleep easier.
