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As many Australian businesses look for a road back to solvency, reducing debt through Small Business Restructuring could be the vehicle that gets them there.
Is Small Business Restructuring your clients' path out of debt?
18 August 2023
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4 minute read
The past few years have created almost the perfect storm for small business insolvencies in Australia - from natural disasters to the pandemic that brought with it restrictions on trade for many, prolonged supply change disruptions and more recently inflation putting further financial pressure on recovery.
Many businesses are currently under an ATO payment plan with total outstanding debts from small business to the ATO increasing from $26 Billion to $44 billion in the 2 years to June 2022. Not only have debt levels increased but the ATO has recommenced its debt recovery methods with increasing numbers of director penalty notices, garnishees and reporting tax debt to credit reporting bureaus being issued.
Over 3,008 businesses had been appointed an administrator to help dig them out of a financial hole in Q4 of the 2022-23 financial year, an increase of 57% from the 1,921 that were assigned in the previous corresponding period. And many of these appointments were made under advice and direction from their accountants.
It's safe to say that you also probably have some clients who are losing sleep over how they manage their businesses debt and what options are available.
The new option is Small Business Restructuring.
Accountants are so much more than just number crunchers for Australian businesses, they are advisers, planners and confidants, and in fact according to a 2018 report conducted by NAB, Australian SMEs consider accountants their most trusted business advisers – over half putting them in top place*.
So as business owners look for advice and guidance, an awareness of restructuring and access to a Small Business Restructuring Specialist is a must in 2023 for all Australian small business accountants.
What is Small Business Restructuring?
In 2021 the federal government made changes to the insolvency framework by introducing a new simplified debt restructuring process called Small Business Restructuring. The process allows financially distressed small businesses access, through a registered practitioner, to a quick and inexpensive procedure to submit a proposal to reduce company debts, while allowing the owners to remain in control of their business.
The process involves no 3rd party external administration, liquidation of assets and, whilst conducted by a registered restructuring practitioner who works as a company agent, the business owners continue running the business and work with their accountant on the day to day accounts.
Every day our team of specialists work with owners, directors and accountants to find viable solutions to insolvency without disrupting regular business activities. Working with the Small Business Restructuring Specialists you and your clients can expect:
- Fixed pricing – you will be given a fixed price for the restructure, allowing you to help them to make an informed and calculated decision before proceeding.
- Predetermined timeline – the whole process is completed within 35 business days.
- Simple qualification – the legislation details a process that’s designed to be as simple and accessible to as many businesses as possible, with minimum eligibility criteria.
- Total control – whilst we create and propose the restructure your client keeps running the business and you, the accountant, remain their trusted adviser.
- Tailored payment structure – whilst every restructure is different, clients can secure terms up to 36 months with the facility to incorporate lump sums at predetermined times.
- Permanent Debt Reduction – on average our clients experience over 80% reduction in debt, without loans, or any form of liquidation. And the debt is gone forever.
To find out more about how working with the Small Business Restructuring Specialists could benefit you and your clients reach out to principal practitioner Thomas Dawson at
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