ATO Debt Refinance: A Simple Guide When Repayments Feel Too Much
Last updated: 18 January 2026
Written by: Michael Pajar, Director & Business Finance Broker
If you’ve got ATO debt, it can feel like you’re carrying a weight.
Not just in the business.
In your head.
A lot of business owners don’t worry all day because of the total balance.
They worry because of the repayments.
They look at the numbers and think:
“How am I meant to pay that every month?”
“If I pay that, what happens to wages, rent, stock, suppliers?”
“One bad week and I’m done.”
That’s usually when people search ATO debt refinance online or on ChatGPT.
Not because they want more debt.
Because they want a structure the business can actually live with.
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Disclaimer
This is general information only. It isn’t tax, legal, or accounting advice.
This post doesn’t include negotiation tactics or step-by-step instructions, because every situation is different.
What “ATO debt refinance” means
It usually means this:
A business uses finance to pay off (or reduce) an ATO debt, then the business repays the lender over time.
So instead of owing the ATO directly, the business owes a lender.
It doesn’t erase what happened.
It changes the repayment shape.
Why the term matters (this is the real pain)
This is the part many people don’t say out loud:
A lot of ATO debt situations feel “impossible” because the debt is too big and payment plan is too short.
When the term is short, the repayments get big, fast.
Some business owners are offered repayment timeframes that are too tight to carry but have to accept anyway.
And with ATO payment plans, the timeframes being seen in many cases can be around 12 months (it can vary), which can also mean very large monthly payments.
That’s when owners think:
“This doesn’t fit my cash flow.”
“I can’t run a business like this.”
So they start looking for a different structure.
What the finance can look like (so it helps)
There are usually two broad options.
1) Unsecured (no asset used as security)
In some cases, terms may be available up to around 3 years.
This can suit businesses that want a simpler setup, if the numbers stack up.
2) Secured (an asset used as security)
In some cases, terms may be available up to around 5 years when security is used.
Security might be:
property, or
an unencumbered vehicle, truck, trailer, or equipment
“Unencumbered” just means there’s no existing finance secured against it.
Important: terms and availability vary and are always subject to assessment.
Why monthly repayments can feel like breathing room
ATO pressure often comes in waves.
Letters. Deadlines. Worry.
Then another spike.
Many finance options have repayments that are monthly.
For many business owners, monthly repayments can feel easier to plan around because the business can breathe between payments.
It doesn’t fix cash flow by itself.
But it can make the week-to-week feel less panicked.
Or at least allow you to plan ahead.
The part nobody says: it’s not just money
ATO debt doesn’t just hurt the bank account.
It often hurts:
sleep
focus
patience
decision-making
confidence
Some owners keep trading, keep smiling, keep showing up…
while quietly thinking about the debt every day — especially before sleep.
That’s why a “workable structure” can matter so much.
It can give the owner their head back.
When refinancing may actually help
Refinancing is often explored more seriously when:
the business still has steady income
the repayments options are affordable
the debt built up during a rough patch, not as an ongoing pattern
lodgements are up to date (or close), so the position is clear
The owner wants to get back in control
In simple terms:
the business is still viable, but the current pressure is crushing.
When refinancing can make things worse
This is important too.
Adding a new repayment can add pressure when:
the business is already missing other payments in the last few weeks
cash flow only works in “good trading weeks”
lodgements are behind (will need to bring BAS up to date first)
the plan relies on “things improving soon” without evidence
In those cases, speed can feel comforting — but the structure may not hold.
What lenders usually look at (for tax-related deals)
Most lenders don’t only look at the ATO number.
They usually look at the full picture:
does the business have steady income?
do bank statements show the business can handle the new repayments?
are lodgements up to date (or close)?
are there other arrears (rent, suppliers, other loans)?
is there a clear reason the debt built up?
A common starting point is at least 12 months of business bank statements, because that’s where the lender can see the full picture.
What about paying it out early?
Some unsecured loans may allow early payout after a set period without break costs.
That can matter for owners who want:
stability now, and
the option to clear it sooner if trading improves
This only applies to a few lenders, not a guarantee.
Some lenders offer a no break fee option after 6 months — while others just after 3 months.
A quick example
A business can look fine from the outside and still feel like it’s drowning.
Many owners tell us:
sales are coming in, but money disappears fast
wages and rent always coming first
they can’t afford to pay BAS
the repayments of existing loans aren’t manageable
In that kind of situation, the main pain isn’t “the debt”.
It’s that the repayments are too much to handle.
That’s why refinance becomes a topic.
Sometimes we look to refinance the entire thing.
FAQs
Can ATO debt be refinanced?
In many situations, businesses explore finance to repay or reduce an ATO balance. Whether they can refinance depends on serviceability, if lodgements are up to date, and their overall position.
Is it always unsecured?
Not always. Some options may be unsecured (often shorter terms). Some may be secured using property or an unencumbered vehicle, truck, trailer, or equipment (often longer terms). We specialise in utilising your business assets to not only get longer terms but almost always lower rates than the unsecured alternatives.
Are repayments always monthly?
Many options are monthly, but repayment frequency can vary. We usually hear that monthly is ideal.
Does refinancing stop ATO pressure?
If an ATO balance is repaid, pressure relating to that balance may reduce. Ongoing obligations still matter, so a good strategy behind the refinance is importance.
Is this tax advice?
No. This is general information only. A qualified accountant or tax professional is best placed to confirm tax and compliance implications.
Related resources
Director penalty notice (DPN): refinance ATO debt
ATO payment plan changes
ATO tax debt changes (2025)
Finance options for hospitality behind on tax
Are business loans tax deductible?
Want a responsible way to look at this?
When ATO debt is involved, the most helpful first step is often clarity.
Not panic.
Not pressure.
Just a clear view of what looks realistic.
If you’d like, CASEY can do a quick initial eligibility check based on what a business chooses to share, and explain what typically looks workable (and what can add risk).
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