Updated ATO expectations for supporting a small business restructuring plan

The Small Business Restructuring (SBR) framework has quickly become one of the most widely used mechanisms available to financially stressed SMEs. From only a handful of appointments in FY21, uptake has expanded to almost 3,000 SBR appointments in FY25, now representing a substantial proportion of all formal insolvency appointments across Australia.

As the use of SBR has grown, so has the Australian Taxation Office's level of scrutiny. Given that the ATO is often the largest creditor in an SBR, its vote can determine whether a restructuring plan proceeds. Recent practitioner experience shows that the ATO's expectations and approach are now clearer, more structured, and more rigorous than when the regime commenced.