Tax debt loans to pay the ATO
A tax debt loan pays your overdue ATO debt in full, direct to the Australian Taxation Office, so the interest and the enforcement stop. HomeSec lends $20,000 to $5,000,000 against equity in real estate, with no financials, no credit score minimum and no repayments for up to six months, funded in as little as 24 hours.
See if you qualify in sixty seconds. No credit check to apply, no financials, no payments for the first six months. That's the HomeSec Advantage.
See if you qualifyWhat happens next
We call you
A Lending Manager reads what you sent and rings you — in business hours, usually within minutes. You can also call us now on 1300 93 83 87.
An answer on that call
Tell us the amount, any notice and its deadline, and the property. You will usually know on the call whether we can do it.
The ATO is paid
Paid direct to your ATO account at settlement, in as little as 24 hours from a clean, complete scenario. Then up to six months with no repayments.
Help with an ATO debt: your options, honestly
Most people searching for help with a tax debt are not looking for a loan yet. They want to know what can be done. These are the real options, and a loan is only one of them.
- Pay it from cash, if you can. Nothing is cheaper. If you can do it without starving the business, do it.
- A payment plan with the ATO. Many businesses can set one up themselves — see how to set up an ATO payment plan. It stops the escalation while you keep to it, but general interest charge keeps compounding daily, currently 11.51% a year, and a missed instalment can cancel the plan.
- Asking the ATO to release or waive it. Release from a tax debt is only available to individuals. The ATO says plainly that companies, trusts and partnerships can't apply, and GST, PAYG withholding, the super guarantee charge and director penalties can't be released at all. You can ask for interest or penalties to be remitted, but that is at the ATO's discretion, so it is not something to plan around.
- A tax debt loan. Pay the ATO in full, stop the interest and the enforcement in one go, and repay a lender who is secured on property instead — with no repayments for up to the first six months and an open term. That is what the rest of this page is about.
Ignoring it. An unpaid ATO debt does not sit still: it moves to garnishee notices on your bank account, Director Penalty Notices that make directors personally liable, disclosure to credit reporting bureaus, and in the end a statutory demand or a winding-up application. Every one of those is easier to fix the day before it arrives than the day after.
HomeSec is a private lender. We are not the ATO and are not affiliated with it. This page is general information, not tax advice — your accountant or a registered tax agent is the right person for that.
The 1 July 2025 change that altered the arithmetic
From 1 July 2025, the ATO’s General Interest Charge and Shortfall Interest Charge are no longer tax deductible. For years, carrying a tax debt was partially subsidised by the deduction on that interest. That subsidy is gone.
Penalties are a separate thing and they never were deductible — a penalty imposed under an Australian law has always been denied under section 26-5. What changed in 2025 is the interest, and the interest is the part that compounds daily on a large balance. At the current 11.51% the ATO is now, in after-tax terms, one of the most expensive creditors a profitable business can have.
The practical consequence: the after-tax cost of leaving money owing to the ATO rose materially overnight, while interest on commercial borrowing used for business purposes generally remains deductible. For a profitable business carrying a large balance, refinancing an ATO debt into commercial credit now compares very differently than it did two years ago.
Deductibility depends on your circumstances and we are not tax advisers. What we can do is fund the payment quickly. The comparison worth running with your accountant is the after-tax cost of the ATO balance against the after-tax cost of the facility that replaces it.
Why the ATO is no longer a patient creditor
- Debt disclosure. The ATO can report a business tax debt to credit reporting bureaus where the business has an ABN, owes $100,000 or more overdue by more than 90 days, and is not effectively engaging with the ATO about it. Twenty-eight days' written notice is given first. Keeping a payment plan current, or having an objection or a hardship application on foot, is what "effectively engaging" means — and it is the whole reason a defaulted arrangement is more dangerous than the debt itself. Once reported, the balance is visible to every lender, supplier and insurer who searches you.
- Director Penalty Notices. A DPN can make directors personally liable for unpaid PAYG withholding, GST and superannuation. Lockdown DPNs cannot be remitted by appointing an administrator. The response window is short and unforgiving.
- Garnishee notices. The ATO can require your bank or your debtors to pay it directly, without a court order.
- Payment plan defaults. A single missed instalment can terminate the arrangement and reinstate the full balance.
Which of these is actually happening to you?
"ATO debt" covers five quite different problems with five different clocks on them. The pages below deal with each one specifically — what the deadline really is, what the exposure is, and what funding does and does not fix.
Can I get a loan if I already have an ATO debt?
Yes. An outstanding ATO balance is one of the most common reasons a business owner is here, and it is not a reason for us to decline. We do not require tax returns, BAS lodgement to be current, or a clean credit file. We lend against property equity and a credible exit.
This is exactly where a private lender and a bank diverge. A bank sees an ATO debt as an adverse credit event and generally stops. We see it as the problem the loan exists to solve.
A payment plan is not the end of the problem
Most people who ring us about a tax debt are already on an arrangement, and treat it as solved. It is not solved, it is scheduled — and two things about it are worth knowing before you rely on it.
It is unforgiving. Miss one instalment and the arrangement can be cancelled, at which point the whole balance is payable again and you are back in active collection rather than in a plan. The ATO is not obliged to give you another one, and the second arrangement is harder to get than the first. See what happens when a plan defaults.
Other lenders can see it, and most of them care. A current arrangement does protect you from having the debt reported to credit bureaus — that protection is the whole point of engaging. But it does not make the debt invisible. Any lender running a serviceability assessment asks for an ATO integrated client account statement or reads the direct debits in your bank statements, and a tax arrangement in either place reads as committed cash flow and an unpaid liability. For a good many lenders it is where the application stops.
Clearing the balance removes both problems at once: nothing left to default on, and nothing on the account for the next lender to find. That is the argument for paying it out rather than paying it down, and it is a stronger one since the interest stopped being deductible.
How the payment actually works
Funds are remitted directly to your ATO account using your payment reference number, rather than passing through your business account first. That matters for two reasons: the balance clears and the interest stops on the day of settlement rather than whenever a transfer happens to be made, and there is no window in which the money is available to be spent on something else.
$96,000 ATO balance, DPN issued
A transport operator with a lockdown DPN on unpaid PAYG withholding and eleven days remaining. Two years of financials unavailable; the accountant was mid-catch-up. Security was the director's home in a regional Victorian centre with roughly $340,000 of equity behind a bank first mortgage.
- Instrument
- Caveat, first mortgagee consent not required
- Advanced
- $104,000 — debt plus costs
- Paid
- Direct to the ATO, same day
- Time from first call
- 31 hours
- Exit
- Refinanced to a bank facility at month 7
Composite illustration based on the pattern of files HomeSec writes in this category, not one client's file.
How much you can borrow
Take the property's value, multiply by 80% for residential security or 70% for commercial, and subtract what is already owing on it. What is left is roughly what is available, between $20,000 and $5,000,000. Several properties can be added together, and the borrower does not have to be the owner — companies, trusts and sole traders — including start-ups, with everyone on title signing. Up to 80% on residential and 70% on commercial. Lower on large acreage, and LVRs may reduce on properties worth less than $800,000.
From the call to the money
Tell us the deal
Amount, purpose, timing, the property and how the loan gets repaid. A Lending Manager gives you an indicative answer on that call — usually in minutes.
Minutes
Conditional approval
Photo ID, a rates notice and your most recent mortgage statement. That is the whole list, and it takes about fifteen minutes.
About 15 minutes
Funds released
As little as 24 hours from a clean, complete scenario. Paid where you tell us — to your account, or straight to the ATO.
As little as 24 hours
What it costs
Priced per file, on the property, the position, the amount and the exit. No rate is published, because a rate with "from" in front of it is the best file's number. How it is priced, and every fee that exists.
Questions we get on the phone
Can I get a business loan to pay a tax debt?
Will the ATO forgive or release my business's tax debt?
Do you pay the ATO directly?
My payment plan has already defaulted. Does that matter?
Can I clear part of the debt rather than all of it?
My tax returns are not lodged. Is that a problem?
How long can I keep the loan?
How much can I borrow to clear an ATO debt?
Does an ATO debt appear on my credit file?
What is the difference between a tax debt loan and an ATO payment plan?
Tell us the amount, the purpose and what property is available, and we will tell you which instrument fits and what it costs. 1300 93 83 87, Mon–Fri, 8:30am – 5:30pm Melbourne time.
See if you qualify in sixty seconds
Three short questions, no credit check to apply and no financial statements. A Lending Manager reads it and calls you back with a real answer — not a call centre, not an algorithm.
That's the HomeSec Advantage.
Reviewed by Catriona Anderson, General Manager