Small businesses in Australia are facing mounting debt levels, with outstanding debts to the Australian Taxation Office (ATO) skyrocketing from $26 billion to $44 billion in the span of two years. As a result, many business owners are seeking a solution to reduce their debt and regain solvency. Small Business Restructuring could be the answer you’re looking for.
The Benefits of Small Business Restructuring
Small Business Restructuring offers several advantages for financially distressed businesses:
1. Fixed Pricing and Predetermined Timeline
The process comes with fixed pricing for the restructure and a predetermined timeline of 35 business days. This provides certainty and transparency for business owners, allowing them to plan their financial recovery effectively.
2. Simple Qualification Process
Qualifying for Small Business Restructuring is straightforward, making it accessible to a wide range of businesses. This simplicity ensures that eligible businesses can swiftly begin their debt reduction journey.
3. Retained Control and Tailored Payment Structure
Unlike other debt reduction methods, Small Business Restructuring enables the client to retain control of their business throughout the process. Additionally, a tailored payment structure is established with terms of up to 36 months. This flexibility allows businesses to manage their payments in a way that suits their unique circumstances.
4. Permanent Debt Reduction
The goal of Small Business Restructuring is to achieve permanent debt reduction without resorting to loans or liquidation. This sustainable approach ensures a long-term solution for businesses struggling with debt.
The Rise of Small Business Restructuring
The increasing need for debt relief has led to a rise in the number of businesses seeking Small Business Restructuring. In the last quarter of the 2022-23 financial year, 3,008 businesses were appointed an administrator, marking a significant 57% increase compared to the previous corresponding period. This surge highlights the growing demand for this debt restructuring process.
The Role of Accountants in Small Business Restructuring
Accountants play a vital role as trusted business advisors for Australian SMEs. Being aware of Small Business Restructuring and its benefits is crucial for accountants in 2023. By understanding this process, accountants can guide their clients towards a viable solution to insolvency while minimising disruption to regular business activities.
Conclusion
Small Business Restructuring offers hope for Australian businesses burdened by debt. With its simplified qualification process, retained control, and tailored payment structure, it presents a realistic path to reducing debt and achieving solvency. For more information and assistance, contact SMG Accounting Services Pty Ltd at (02) 9832 2078.