From 1 July 2017 the ATO have a new power – they are now able to disclose your tax debt information to Credit Reporting Agencies.
It will initially apply to businesses with a tax debt of more than $10,000 that is at least 90 days overdue.
A credit default is a black mark against your business’s credit rating that lasts for five years and means your business may find it difficult to obtain or renegotiate finance from banks or favourable credit terms with suppliers.
This is a relatively new power the ATO has so we will have to wait and see how aggressively the ATO implement it. The ATO have indicated that they will only use this power if a business has not effectively engaged with the tax office to manage its debt.
What do you need to do?
If you have a tax debt that is 90 days or more overdue and don’t have a payment plan arrangement in place you need to organise this immediately!
How can we help you
So heed the warning…don’t ignore your ATO debt! Burying your head in the sand is not the answer and if you need assistance please give the team at MJJ Accountants a call.