banjo-logo

Business lending

Business lending

Simple, swift working capital and asset finance to help growth-driven businesses to develop and succeed.

Banjo Express

Get fast access to funds with less paperwork

Flexi Working Capital Loans

Get up to 4 months interest expense only repayments with

Single Pay Loans

Get a bridging finance facility to release working capital

Working Capital Loans

Get cashflow funding options to help growth

Asset & Equipment Finance

Get a flexible asset loan to finance assets and business moving forward

Our partners

About us

Knowledge hub

Login

If you’re a small business and have a tax debt, there are several ways to tackle it and get back to doing what you do best.   

While the tax problems of a struggling small business owner certainly weren’t glamourised in the multi-Oscar winning movie “Everything, Everywhere All At Once”, in real life we can’t expect to be thrown into a multiverse to resolve this predicament.  But one thing’s for sure – it can be solved, and you can go on to thrive.   

According to the ATO Second Commissioner last year, it was estimated that small business was accountable for $12 billion of the estimated $33 billion overall tax gap.

“Generally the ATO will work with and support businesses who want to do the right thing in respect to any outstanding tax debts. Early engagement with the ATO and establishing a payment plan is a key step to working through any taxation obligation issues. This will assist in dealing with the debt whilst it’s still manageable”

- Andrew Ward, Banjo Loans

There are as many reasons for getting behind on taxes as there are businesses. Finances can be overwhelming, and SME owners often juggle so many balls in the air at once, that mistakes can happen. Or it could be illness in the family; the fast-growing business sucking up all available capital; or other events outside the owner’s control.     

According to Olga Koskie, Principal at tax debt specialists Tax Assure, many business owners are embarrassed to reveal that they have tax debt – but they needn’t be.   

“People often feel unique in this situation, but it’s pretty common. It can happen to anyone and is very fixable. What matters is clearing the debt in a smart and effective way, rather than ignoring it and hoping it will go away.”  

Olga works with accountants, brokers, lawyers and financiers to help their small business clients to effectively and successfully address their ATO debt. 

“At the heart of tax debt is people, not numbers. My business is about helping them get out of the jam they’ve found themselves in and get back to focusing on running their business.” 

“Often in business ‘you don't know what you don't know’. It’s a bit like the medical world – there are specialists who can help with particular business problems. It’s important to be able to access the right networks and support, whether it’s negotiating with the ATO, getting into a payment plan, or sourcing a loan for your client to get rid of the tax debt,” says Olga.

“However, the business must act to deal with this. If they’ve got a tax debt but are in a payment arrangement, the ATO considers them compliant. If the debt is overdue and they’re not in a payment plan, they’re considered non-compliant and the ATO will take further action,” she explains.   

Olga sometimes comes up against a misconception that the ATO charges low interest on tax debt.  She points out that the ATO interest rate is 10%, and importantly is compounded daily. It can be very expensive to ignore this debt, and Olga cautions that some SMEs have misguidedly treated it as a kind of de facto ‘loan’ by the ATO.

“People often feel unique in this situation, but it’s pretty common. It can happen to anyone and is very fixable. What matters is clearing the debt in a smart and effective way, rather than ignoring it and hoping it will go away.”

- Olga Koskie, Tax Assure

Instead, it can be far smarter to seek a business loan to reduce or clear tax debt and manage the business’ cashflow more wisely. Many smaller, nimbler lenders are sympathetic to this approach, and have competitive working capital loans that will suit this purpose. 

Another point to bear in mind is if a business owner needs to take out additional finance for another reason (for example a home loan or an important business opportunity) a lender is likely to look more favourably on an existing business loan than outstanding ATO debt.

Olga says that in last few weeks there has been a major uptick in ATO collection activity. Now is the time for SMEs with tax debt to explore their achievable finance options for getting rid of it and the stress, and get back to working smarter, being fulfilled in business and achieving growth plans.

The definition of small business in Australia according to the Australian Bureau of Statistics (ABS) employ fewer than 20 people.

Our commitment to you

bfo-logoafca-logo
* Disclaimer: Fees, lending criteria, terms and conditions apply (including an origination fee on each advance). Actual fixed fee (or interest expense) and repayments will vary based on your individual circumstances. Advertised rates are subject to change at any time. Fixed fee (or interest expense) accrues upfront and is paid in instalments. While Banjo does not generally take security over assets, director guarantees may be required and a general security deed or other security may be required for larger loans or in respect of some loan types. Statements regarding timing in relation to applications, approvals and funding are only indicative. Any advice given does not take into account your personal circumstances and you should carefully consider what products are appropriate for you and obtain professional advice where relevant.

Copyright © 2022 Banjo® Loans. Banjo® and Banjo Score® are registered trade marks used under licence by Banjo Loans. All loans are provided by FundIT Ltd ACN 601 130 527 in its capacity as trustee of the Banjo Small Business Loan Fund ABN 32 713 685 984 (AFSL 468033). All loans are subject to eligibility criteria and approval by Banjo. Upfront fee, terms and conditions apply.