ATO DEBT NOW AFFECTS YOUR CREDIT RATING.

Before 1 July 2017, your ATO debt did not appear on your credit report, but things have changed. If you’re debt is over $10,000 and you’re more than 90 days late in paying, the ATO can now disclose that debt to Credit Reporting Bureaus, thereby negatively impacting your credit rating.

The new rule is part of the Government’s strategy to recoup overdue tax debt – currently sitting at approximately $19-billion. Of that amount, around two-thirds is owed by small businesses with an annual turnover of less than $2-million.

Up until now, failing to pay the ATO on time had no real impact on our clients, apart from Failure to Lodge and General Interest Charges. In fact, there was no strong incentive to pay until the ATO threatened to take business owners to court. Now, however, an ATO tax debt can affect your credit rating for five years, which in turn impacts your ability to apply for finance and supplier credit.

If you’re currently in this situation, we strongly advise you to discuss this matter with your Bongiorno representative. There are ways to minimise any penalties, providing you act now.