The client's been carrying a debt for about 18 months and fuel costs have made it worse. I said I can tell you what it is and I can tell you what it isn't. That's what this month's column is about.
Who is this for?
If you run a business in transport, construction, agriculture, logistics, or anything that moves goods, you've felt the fuel crisis already. The government has responded with a temporary cut to fuel excise and the ATO has announced a formal relief package for businesses carrying tax debt.
Before you do anything, here's what you need to know.
What the ATO has announced
From 1 April, businesses affected by fuel costs can apply for a tailored payment plan. No upfront payment, 36 monthly instalments, and possible remission of general interest charge if you meet the conditions. Applications are open until 30 June 2026.
Who qualifies
You need to meet four criteria. Your operating costs must have increased because of fuel, either directly or through your supply chain. You need to have a tax debt you can't currently service. You need to show that without the fuel price increase, you could have paid.
And your lodgments need to be current, or you need to get them current within three months of starting any arrangement.
That last point is the one that catches people. If your lodgments aren't current, you're not eligible. That's the bit most people miss.
What it isn't
This isn't debt forgiveness and it isn't automatic. The ATO can't waive what you owe, and there's no guarantee your application will be approved. You apply, they assess it, and they decide whether to approve.
Worth knowing too: the terms being offered are what we'd normally negotiate for any business in hardship. Thirty-six months, no upfront payment. That's been available for a while. The fuel crisis label is new, but if you've worked with us before, you'll recognise the mechanics.
What to watch out for
To apply, you need to provide direct debit details. If the ATO doesn't approve your arrangement, they now have your bank account on file, and that's information they can use for enforcement action later. That's worth understanding before you fill in the form.
There's also a question about older debt. The ATO is talking about fuel impact on your current ability to pay. If the debt is two years old and predates the crisis, it's unclear how they'll assess it. We're testing this with live cases right now.
What to do if this affects you
Get your lodgments current first. You won't get anywhere until that's done.
If you're carrying tax debt and fuel costs are adding to the pressure, don't go straight to the ATO without understanding your options. What you agree to now is what holds when enforcement returns to normal. We're happy to talk it through.
Next month I'll be covering payday super. A
nother change hitting 1 July that will compress cash flow and, for businesses already stretched, will create new ATO debt if they're not ready.
Michael Moon is a Director at Tax Assure, a specialist tax debt negotiation firm. Tax Assure works on an assessment and engagement fee followed by a success fee based on GIC and penalties actually remitted. Initial consults are obligation free. 1300 952 295 | www.taxassure.com.au
