Struggling Financially? What Business Owners Should Know About Small Business Restructuring.

When financial stress starts to mount—whether from overdue taxes, increasing debts, or pressure from creditors—it can feel overwhelming. For small business owners, these challenges often bring serious concerns about the future of their operations and livelihood.

But there may be a way forward.

If your business is still fundamentally viable, Small Business Restructuring (SBR) could offer a practical path to stabilise your operations, engage with creditors constructively, and continue trading—without surrendering control of your company.

Understanding Small Business Restructuring (SBR)

Introduced in 2021, SBR is a formal process designed to help small companies manage financial distress while remaining under the direction of their existing owners or directors. It is specifically available to companies with total liabilities of less than $1 million and must be overseen by a licensed Small Business Restructuring Practitioner (SBRP).

Unlike traditional insolvency approaches—such as voluntary administration or liquidation—SBR allows directors to stay in control during the process, making it a practical solution for businesses that are operational but weighed down by debt.

Who Assesses Eligibility for SBR?

To begin the SBR process, you’ll need to engage a registered SBRP, who will evaluate whether your business qualifies under the official criteria.

Before reaching this stage, it can be beneficial to speak with trusted business advisors—such as accountants or restructuring professionals—to help determine whether this approach aligns with your business’s financial position and goals.

To qualify for SBR, a company must:

• Be operating through a company or trust structure (not available to sole traders);

• Have total liabilities under $1 million (including secured and related-party debts, excluding unpaid employee entitlements);

• Be up to date with employee entitlements (including superannuation);

• Be current with ATO lodgements (tax debts can still be outstanding); and

• Not have used SBR or simplified liquidation in the last seven years.
  

If your business meets these requirements, and there is a reasonable chance of recovery, SBR may offer a structured way forward.

Advantages of the SBR Process

SBR can deliver several key benefits for eligible small businesses, including:

• A temporary pause on debt recovery action, giving the business breathing space;

• A tailored restructuring plan to manage or reduce outstanding debts;

• The oversight of a qualified SBRP, ensuring compliance and minimising director exposure to personal liability.
  

The Importance of Strategic Business Advice

At Symmetry Accounting & Tax Pty Ltd, we recognise that navigating financial difficulty involves more than ticking boxes—it requires a clear understanding of the bigger picture.

In many cases, working with knowledgeable advisors can assist in:

• Reviewing your risk exposure and determining whether SBR is the most suitable option;

• Identifying essential assets—such as licences, intellectual property, or customer contracts—that need protection during restructuring;

• Preparing for the restructuring process, including supporting documentation and communication with stakeholders;

• Considering other options, such as informal negotiations, voluntary administration, or an orderly exit, if SBR isn’t the right path.
  

This kind of holistic insight can be crucial to achieving the best outcome for both your business and your personal position.

Could SBR Help You Keep Trading?

SBR has the potential to:

• Provide temporary relief from creditor actions;

• Maintain staff employment and operational continuity;

• Safeguard business relationships and reputation; and

• Preserve critical licences or accreditations that might otherwise be at risk.
  

That said, it’s not an automatic solution. Creditors still need to approve your restructuring plan, and success depends heavily on early action, transparency, and professional guidance.

If your business is under pressure but not beyond repair, now is the time to explore your options. At Symmetry Accounting & Tax Pty Ltd, we can help you understand the financial implications of SBR and whether it aligns with your goals.