We’ve worked with a couple of clients recently to help them restructure their businesses and ATO debts. It’s all to easy to put off paying your tax obligations, run up a big bill with the ATO and start receiving demand letters from Dun and Bradstreet. What should you do if you find yourself in this situation?
Step 1: DON’T PANIC.
Step 2: CALL FUSION TO REQUEST A MEETING
Step 3: WE WILL PRESENT YOU WITH A PLAN TO GET BACK ON TRACK
One of our current clients had fallen behind on their tax obligations to the tune of over $200,000 and were let down by their accountant not delivering their promised business accounts on time. Due to a missed payment, the ATO made a demand for two lump sum payments comprising over $90,000 in obligations to be paid within a four week period which would have put their business out of business. Despite pleas from themselves and their accountant, the ATO would not budge on this request.
Fusion was engaged to assist and were able to negotiate an 8 week extension on the payment while we put together a business plan and cashflow forecast to justify a sustainable payment arrangement with the ATO. We were able to secure a payment plan of $10,000 per month over two years for the client helping them get their cashflow back on track.
The ATO can be surprisingly approachable about payment arrangements that are properly presented to them. We suggest this is best done with the assistance of a good accountant.
Better still is to structure your business to avoid these problems in the first place. By having and sticking to a business budget and regularly setting aside money in a separate account to pay your tax obligations can help prevent this situation occurring.
If you would like to discuss with Fusion how our accounting team can add value to your business, please contact us today.