How we helped a business clear a $108K tax debt in just 2 DAYS!
At Provident, we understand the pressures that tax debt can place on a business.
Recently, we had the privilege of assisting a client who was grappling with a substantial $108,000 tax debt. The client had been struggling to stay ahead of the repayments, especially since the payment plans available from the ATO only extended up to 18 months.
This resulted in hefty monthly payments of $6,000, which left little room to provision for future tax obligations or maintain cash flow to run the business smoothly.
The Challenge
The challenge our client faced was not just paying off the existing debt but also keeping up with ongoing tax liabilities. With such high monthly payments, the business had no breathing room to invest in growth or handle day-to-day expenses.
While the ATO's interest rate of 11.38% seemed attractive at first glance, the short repayment terms placed a significant strain on cash flow. This is a common misconception among businesses—the idea that ATO debt is a cheaper form of financing.
While the interest rate may be low, the rapid repayment timeline can often leave businesses scrambling to stay afloat.
Our Solution
At Provident, we specialize in finding tailored solutions to fit the unique needs of each client. After working with our trusted panel of business lenders, we were able to secure a loan for our client with an unsecured rate of 14%, extended over a 5-year period. This allowed us to spread the $108,000 tax debt over more manageable monthly payments of just over $2,500.
The immediate impact on cash flow was significant. Not only did this relieve the financial pressure on the business, but it also allowed the client to plan more effectively for future tax obligations, avoiding the need for ATO payment plans in the future.
Why a Longer Term Matters
Many business owners believe the ATO offers the best financing option for tax debt, but the truth is that the short repayment terms—often less than two years—can actually exacerbate cash flow issues. With longer repayment terms, businesses can make smaller, more manageable payments, giving them the flexibility to stay on top of their finances and avoid falling behind.
If you're struggling with tax debt or feeling the squeeze of a short-term repayment plan, Provident can help. We offer solutions that provide immediate cash flow relief, so you can focus on running your business without the constant worry of meeting large, unaffordable payments.
Take Control of Your Tax Debt Today!
Don’t let tax debt hold your business back. Contact Provident today and let us help you find the financial breathing room you need to thrive. Whether you’re dealing with a large tax debt or simply looking for a way to improve cash flow, we have the expertise and lender network to tailor a solution that works for you.
Let’s work together to secure your financial future—one manageable payment at a time.
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