Five Principal Debt Collection Focuses of the ATO

By Alexander Laureti
September 12, 2023

The Australian Taxation Office (ATO) has recently identified five primary types of business debts that are now under its heightened scrutiny. This shift in focus comes as the ATO winds down the exceptional leniency it previously extended to late payers during the COVID-19 lockdowns.

At the Tax Institute Tax Summit held in Melbourne, Mr. Vivek Chaudhary, the ATO’s Deputy Commissioner of Lodge and Pay, highlighted the critical need to support taxpayers during the lockdowns. This included measures like flexible payment plans, deferred payment dates, remission of penalties and interest, and the facility to lodge without immediate payment.

The following are the five debt categories where the ATO’s renewed attention will be most prominent:

  • Unpaid Superannuation Guarantee Charge (SGC): This charge is a penalty for businesses that fail to pay the mandatory Superannuation Guarantee on time. Chaudhary notes, “Small businesses owe the majority of the unpaid superannuation guarantee charge, amounting to $1.8 billion.” The ATO has various instruments, such as garnishee notices, directions to pay, Director Penalty Notices, and potential legal proceedings, to ensure SGC payments. He emphasized, “We’re committed to collecting unpaid super and will rigorously pursue employers not disbursing the rightful entitlements to their employees.”
  • Self-assessed Debts by Employers: Chaudhary expressed concerns over taxpayers deferring payments until the ATO intervenes.
  • Refund Fraud: Fraudulent GST refund claims have siphoned off billions from the tax system, making this a significant area of concern.
  • Major, Aging Debts: These are debts equal to or exceeding $100,000, which are over two years old.
  • Debts Resulting from ATO’s Audit Actions: Some of these debts arise from genuine mistakes, while others emerge from taxpayer negligence or intentional evasion. Chaudhary asserts that no concessions will be provided to these clients, emphasizing the ATO’s expectation of timely payments concerning these liabilities.

Acknowledgment: The original report of this speech was provided by


If you’re struggling with an ATO Debt or cashflow management, please contact us for support and guidance.

Alexander Laureti is the Principal and Managing Director of LMS Advisory. He holds a Bachelor’s degree in Accounting and Law, and he is a Fellow of the CPA (Certified Practising Accountants) and a Chartered Tax Advisor. Alexander has over 17 years of experience as an accountant in Public Practice.
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