The Federal Government announced its plans to enable the Australian Tax Office to disclose small business tax debt information to credit reporting agencies in its mid-year Budget update.
The measure will initially apply to businesses with Australian Business Numbers and tax debts of more than $10,000 that are at least 90 days overdue.
This is set to commence on the 1st of July this year.
Why is this important for those who are self-employed who may be in this situation?
The adverse impact for a business that is reported can be serious.
Once a credit reporting agency has been notified of the tax debt arrears, the default becomes public record which may affect the business’ credit applications with lenders and suppliers.
If credit applications are declined as a result of the default, the viability of the business may be impacted and insolvency could follow.
So what can you do? Make sure you speak to your tax accountant to ensure you have everything up-to-date.
Need a reference? Then get in touch with us at www.equatorialfs.com.au