Tax debt doesn't end the conversationFinance, confidential and fast

The situation

A director facing a growing ATO debt, an active payment plan under strain, or worse, a director penalty notice or garnishee action, is usually dealing with a genuine deadline rather than an abstract concern. The Tax Office moves on its own timeline, and a DPN in particular carries a fixed response window that doesn't extend to accommodate a slow finance process. The requirement here is specific: a facility that clears the debt, or covers it long enough to refinance properly, fast enough to matter and confidential enough not to alarm staff, suppliers or clients who don't need to know the business is under pressure.

Directors in this position are frequently running an otherwise sound business — the debt built up during a genuinely difficult stretch, a client went under, a project ran late, a season underperformed — and the tax debt is a symptom of that stretch rather than a sign the business itself is failing. The finance need is to buy the time and breathing room that the underlying trading position doesn't currently allow.

Why the first answer is often no

Mainstream banks are generally reluctant to lend into an active tax debt situation, and a standard business loan application can take weeks a director facing a DPN simply doesn't have. Credit policy at most banks treats an ATO debt, particularly one that's escalated to a DPN or garnishee notice, as an automatic red flag rather than a situation to be assessed on its specific facts — the size of the debt relative to the business, the reason it built up, and what's changed since. This is precisely the gap private lenders and specialist funds are built to fill, assessing the underlying business and the available security rather than declining on the tax debt alone.

How it gets funded

ATO debt refinance is the most direct route, structured specifically to clear the debt and replace it with a commercial facility on cleaner terms than the Tax Office's own payment plan. Where speed is the dominant factor, a caveat loan sits behind an existing mortgage and can move quickly enough to meet a DPN deadline. A second mortgage suits a longer runway where more time is needed to trade through the position, and a short-term business loan can cover the debt where property security isn't the right fit or isn't available.

Security is typically property — residential or commercial — held by the director or a related entity, assessed on its own terms regardless of the tax debt attached to the business. Lenders in this category see ATO debt regularly and price for the risk rather than declining outright; what matters most is a clear, credible plan for how the new facility gets repaid once the immediate pressure is resolved.

What to have ready

Current ATO account statements or payment plan details, any DPN or garnishee correspondence received, property or security details, entity and director documents, and a short explanation of what caused the debt and what's changed in the business since. Having the ATO correspondence to hand from the first call, rather than summarised from memory, materially speeds up how quickly we can confirm which lenders can actually meet the deadline.

Working with us

We move quickly once we understand the deadline, because in a DPN situation the timeline is often the whole ballgame. The first call establishes exactly what's been received from the ATO, what security is available, and how much time we're actually working with, so we can go straight to lenders who can meet that timeline rather than testing the market broadly.

Everything is handled in strict confidence between you, the lender and Solara. There is no requirement to disclose the arrangement beyond what your own accountant or lawyer already needs to know, and it doesn't need to be flagged to staff, clients or suppliers who have no reason to be aware of it.

⚠ Where the position has moved beyond what refinancing alone can fix, we can refer you to a licensed insolvency practitioner alongside arranging finance, since the two are often needed together rather than as alternatives to each other, and that referral is a decision for you and that practitioner to make, not something we advise on directly.