RSM director Restructuring & Recovery Adam Cormack says while the economy may make businesses feel uneasy, it doesn’t have to be all doom and gloom Photo: Thomas Lucraft.
There is no doubt life is tough for businesses right now. Cashflow is tight, wages and suppliers need to be paid and it is all too tempting to take things day by day and live in hope more customers will walk through the door.
This strategy works until it doesn’t. Things pile up, tax debts and creditors loom, and you run out of ways to pay.
RSM director of Restructuring and Recovery Adam Cormack says when it comes to businesses doing it tough, those in the construction, retail and hospitality sector have suffered the most.
“The pandemic obviously took its toll on everyone and businesses are still recovering from the financial impacts,” Adam says.
“While we’re all still rebuilding from that, the cost-of-living crisis continues to take its toll. So it can be easy to fall behind in keeping track of your costs for your business.”
He says while the state of the economy might make you feel uneasy about your business from a financial point of view, it doesn’t have to be all doom and gloom.
“It’s really a matter of getting back on top of things and being prepared for your expenses,” Adam says.
“This is especially true when it comes to lodging your tax return. A lot of businesses will make the mistake of seeing the dollar amount, assume they can’t pay it back in full straight away and will put off paying or not lodge at all.
“This is the worst thing you can do.
“Negotiating a payment plan is an effective way to pay the tax debt in smaller instalments over a longer period of time which is a much better strategy. This can protect the business from the ATO [Australian Tax Office] taking enforcement action.”
If your business is struggling to make ends meet, Adam recommends applying for a personalised assessment from a trusted financial adviser to get the full financial picture.
He says the best advice for businesses concerned about their financial stability is not to put it off.
“No matter how big or small your business is, or what sector you work in, chances are you’ve had to adapt in recent times and not everyone has come through unscathed.
“The sooner you get started on getting on top of things, the better your chances of success. If debt is becoming a hurdle too big to overcome, there are options. We can work with you to meet your unique needs.
“Our business restructure, liquidation and bankruptcy specialists in Canberra are skilled in handling this type of work. We’ve helped hundreds of Australian businesses not only recover from debt, but to face the future with confidence and thrive.”
Adam says being able to control debt can be difficult.
“If your debt is out of control, then take the first step and reach out for help.
“The earlier our strategies can be put in to place, the easier it can be to relieve and mitigate the debt or associated issues being encountered and limit the effect on you and your family personally.”
RSM has a free checklist to assess your business’s financial stability and solvency. For more information visit RSM in Canberra.
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