Banks and the ATO helping businesses and individuals in tough times

MORE than 55,000 Australian families have been given mortgage-payment holidays and hardship concessions by major banks, revealing the true picture of the financial crisis.

In the past year the banks have extended a financial lifeline to 55,362 people unable to afford their mortgage repayments, personal loans or mounting credit-card debt.

Since February at least 31,000 hardship applications have been made.

Hardship principles were adopted by the banks in April 2009 to assist homeowners to get through the Global Financial Crisis.

Hardship provisions include 12 months repayment freeze for sacked workers, payment deferrals and loan re-structuring and extensions.

The hardship provisions are designed to help families keep their homes and avoid bankruptcy.

On the other side of the equation, the tax department is now prepared to assist sole traders and companies with tax debts by allowing the debtor to enter into repayment arrangements with the ATO – without general interest charges and penalties that are normally associated with tax debts.

The repayment arrangements are usually over 12 – 24 months but at Liquidation Direct we have heard of even longer periods being negotiated by the ATO – again without Penalties and Interest.

This shows the government is doing what it can to protect revenue, stop the incidence of liquidation and bankruptcy and keep employment up in very difficult times.