Opportunities, Challenges and Tax Debt
Whilst the ATO collections activity is ramping up, working capital requirements are a priority for many
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Unsecured overdrafts remain the loan of choice for business owners seeking a business loan that’s not tied to a mortgage.
Loans For Tax Debt
The ATO has communicated it’s giving business owners 28 days to pay their tax debts in full or enter into an acceptable payment plan or risk being reported to credit reporting bureaus and being issued a Directors Penalty Notice (DPN
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DPNs effectively pass the business tax responsibility to the Director making you personally liable for the debt.
Business loan enquiry to pay out tax debt was already on the rise before this activity.
Not wanting to negatively impact their credit file it’s our expectation business owners will seek term loans that extend ATO payment plans and / or have the ability to defer interest for up to 12 months.
Cash Flow Lending
Cash flow is a priority for businesses that are both growing as the economy moves along and for those feeling the rise of supply costs.
With many businesses carrying the extra load of record fuel costs we’ve placed a number of applications over the last 30 days for invoice finance and overdrafts alike.
We expect this trend to continue over the last quarter of the financial year.
Equipment Finance for Large Machinery
Plant Hire companies are reporting strong demand whilst in turn many of their clients are dealing with contractors that are paying late or who have gone out of business.
This is creating a downstream effect resulting in a demand for fast finance to pay wages as a result of delayed payments or while business owners wait for their debtor insurance to pay out.
Bad Credit Loans
Because of this activity, more business owners with defaults or judgments are coming forward seeking finance.
We expect bad credit finance enquiry to rise through the next quarter particularly in the construction industry.
Despite all the challenges there are opportunities still and many operators are seeking funding for growth.
Investment in equipment, people and expansion continues to be a frequent conversation point and driver of new business loans.