1. Assess your financial situation

The first thing you should do is to assess your debts and the money owed to you.


  • setting up a record keeping system to help keep track of your financial situation
  • speaking to an accountant or business adviser.

Get expert advice

Consider talking to a business adviser to help you through your process. Use our adviser search tool to find an adviser in your area.

2. Prioritise your debt

Prioritising your debt can be a quick way to get creditors off your back. Begin by identifying what you can afford to pay now, what you can pay later and when to go on a payment plan. A budget can help plan and direct your money where it matters the most.

Learn how to create a budget.

3. Chase up money owing to you

Contact late or non-paying customers. If you're having problems getting the money they owe you, find out how to deal with not being paid.

4. Talk to organisations you owe money to

Speaking to your creditors early can prevent late penalties or calls from debt collectors. When you talk to them:

  • explain your circumstances
  • ask if they have any hardship provisions
  • ask if you can extend the due date, make a partial payment or go on a payment plan
  • keep a record of your conversation.

If your debt has been passed onto a debt collector, there are certain laws they need to comply with. Find out your rights and responsibilities by:

5. Get advice and help

There are many agencies and experts who can help you manage your debt. These include:

Health and wellbeing organisations

Find more organisations that provide information and support to help you with your health and wellbeing on the ATO website.

6. Contact your bank

Talk to your bank about your finances and explain what you’ve done so far.

It’s a good idea to prepare a profit and loss statement or cash flow forecast. These can give your bank an understanding of the issues your business is facing. This can help when applying for financial hardship.

If you feel you can’t reach a solution with your bank, consider contacting the Australian Financial Complaints Authority (AFCA).

7. Apply for bankruptcy or insolvency

Before you do anything, seek help from a professional, such as an accountant. They may be able to suggest other ways you can repay your debt – that don't involve bankruptcy or closing your business.

There are different bankruptcy arrangements that apply to sole traders and partnerships, and companies.

Learn more about bankruptcy.

Read next

Find out how to improve your financial position.