ATO Debt Restructure: Act Before EOFY or Pay More Than You Should
Tax debt isn't just a liability — it's a trap.
It bleeds cashflow. It clouds judgment. And from 1 July 2025, the cost gets worse, with the ATO scrapping deductibility for interest on unpaid tax debt.
But here’s the real issue: ATO debt isn’t just financial. It’s psychological. It adds weight. It creates avoidance. Clients hesitate, stall, and sink deeper.
Strategic Restructure Is the Way Forward
This isn’t about a quick refinance. It’s about repositioning the client’s entire financial structure to clear liabilities, restore confidence, and support long-term decisions.
That might include:
Accessing equity in existing property
Consolidating liabilities
Supporting an SBRP or negotiated ATO arrangement
How We Do It
At Lenders Domain, we collaborate with firms like:
Tax Assure — ATO negotiation specialists
PCI Partners — SBRP experts for debts up to $1M
Together, we provide a coordinated strategy, not just a finance product.
A Real Example: Restructure Done Right
A successful business — $3.5M turnover — came to us with legacy debt from COVID.
They’d used short-term loans and an overdraft to survive. Now, even with strong profits, they were shackled by repayments, credit card balances, and tax pressure.
Their advisor had missed a key detail: a bank facility not showing on the balance sheet.
We found it. That facility held untapped funds — which we used to clear the ATO debt, wiping a $4,000/month drag and triggering a $30,000 ATO interest credit.
Then we went further:
Consolidated all business loans into a single structure with better terms
Cleared credit cards
Closed the overdraft
Repriced and extended their $1.5M home loan
Released $250K for planned home upgrades
End result? $7,000/month improvement in cashflow.
Don’t Let Tax Debt Derail the Bigger Picture
If you're advising clients carrying ATO debt — this is your window.
Before the EOFY hits, let’s have a conversation.
A 15-minute pre-assessment could reset the whole game.
