We are often asked if government bodies such as the ATO will consider reducing amounts owed to them through debt negotiation, the answer is in many cases yes.
While they are seldom easy to deal with government bodies such as the ATO are no different to most creditors and would often rather settle a debt than try and pursue the matter themselves.
Like most debt negotiation, the key is presenting the matter in the correct way and explaining to the creditor why it is better for them to settle the debt than to continue to try and chase the debtor directly.
Peoples financial situations can change, sometimes not for the better and in many cases it’s not a matter of people not wanting to honor their debts but a situation were they are simply unable to. An example of this could be a loss of a job, a sickness, a business collapse or other significant event.
During challenging financial times people often become overwhelmed and become emotionally unable to deal with their current situation, even though their situation may be recoverable if approached in the right way. Many people don’t realise that in many cases creditors will agree to settle debts for a reduced amount given the clients situation can be substituted and it is in their best interest to do so. the key is dealing with the matter in a professional manner. The ATO is no different, they know that demand letters or even legal action does not always result in payment; in fact this often has the opposite affect and adds even more pressure to people coursing them to withdraw even further and not deal with the problem.
The ATO knows that 100% of nothing is nothing and sometimes continuing to press people for payment just doesn’t work. If a person owes the ATO or other government body an amount of money but their current financial position will only allow them to offer a reduced amount this will often be accepted.
While the ATO is well within its rights to claim monies owed and pursue people and companies for this the reality is like all creditors, they will not always recover the total amount owed. Effective debt mediation is about providing a positive outcome for all concerned, including the creditor. In many cases when we approach a creditor to reduce and settle a debt their reaction is positive as this will often be their only chance of recovering any monies at all and they are often grateful that we are helping resolve the matter for them, this can also be true for the ATO or government body.
Using effective debt negotiation many debts can be reduced and settled which is often not only in the interests of the debtor but also the creditor alike.