In slower economic times it is not uncommon to string creditors out whilst waiting on the hard earned sales dollars to come in and a common way most small businesses have done this over the years is to sit on BAS and GST payments and delay paying our friends in Canberra!

In years gone by this hasn't been a bad strategy  but we are now finding that the tax collector is becoming more aggressive and quicker to act on late payments – who knows -  this may be a result of the government trying to achieve their budget surplus by getting money into their own coffers!

Be aware of the ramifications a tax debt or liability can have on your ability to borrow money. The taxation department has shown they are not shy in stepping in and winding a company up for outstanding debts, and as a direct flow on from this lenders think long and hard about lending to companies with outstanding tax liabilities. (In fact, some lenders have a policy of an instant NO if the borrowers have tax liabilities in the balance sheet or interest owing to the A.T.O in their profit & loss.)  

Work closely with your accountant and Corporate Finance & Leasing if you have an outstanding tax liability. If it is managed correctly, and the right lender is matched to your circumstances, the pain and hassle can be avoided when you come to finance your next piece of equipment, or car, or property.