Pre-insolvency advisers: what they are, what ASIC says, and how to check one

What is a “pre-insolvency adviser”?

It’s a broad label for businesses that offer help to companies in financial difficulty before any formal insolvency appointment. You’ll see them described as debt restructuring specialists, business rescue firms, turnaround consultants, ATO debt specialists or tax debt resolution services. Their services can include:

• reviewing the company’s finances and options;
• negotiating with creditors, including the ATO;
• preparing restructuring proposals;
• referring the company to a liquidator, administrator or restructuring practitioner;
• in some cases, advising on business structures.

None of that is necessarily a problem. Good advice before a crisis can be extremely valuable. The issue is that “pre-insolvency adviser” is not a regulated profession.

What do the regulators say?

ASIC is direct about it: nobody regulates the pre-insolvency industry, and the people in it vary widely in qualifications and experience. ASIC also notes that some of them cold-call struggling companies, and it tells directors to be on guard against dishonest operators who appear offering to “restructure” a business that’s in trouble.

ASIC’s guidance for directors suggests getting advice from a registered liquidator, an appropriately qualified specialist insolvency accountant or lawyer, or a financial advice service — and getting a second opinion. The ATO, in its September 2026 update, recommends advice from registered liquidators and trustees, verified through ASIC’s professional registers.

Who is regulated — and who isn’t?

Role	Regulated?	Where to check
Registered liquidator (including SBR practitioners)	Yes — ASIC	ASIC professional registers
Registered bankruptcy trustee	Yes — AFSA	AFSA’s register
Registered tax agent	Yes — Tax Practitioners Board	TPB public register
Lawyer	Yes — state legal regulator	Law society or legal practice board
“Pre-insolvency adviser”, “debt specialist”, “business rescue”	Not as such	Ask what registrations they hold

A pre-insolvency adviser might also be a registered tax agent or employ one; a firm might work alongside registered liquidators. Ask exactly who is doing what, and check each person.

Why does tax agent registration matter here?

The Tax Practitioners Board says that representing a client in their dealings with the Commissioner — including payment arrangements — is a tax agent service, and anyone providing tax agent services for a fee must be registered. So if an adviser is negotiating your ATO payment plan or debt for a fee, they (or someone in their firm) should be a registered tax agent. See negotiating ATO debt.

How do legitimate advisers behave?

• They put advice and fees in writing, before you commit.
• They explain all the options — including ATO plans, funding and doing nothing yet.
• They’re open about referral relationships and any payments they receive.
• They tell you what a process won’t fix — lockdown DPNs, personal guarantees, the 7-year SBR bar.
• They encourage a second opinion.
• They never suggest moving assets without full value being paid, or holding back records.

Behaviour that doesn’t match this list is covered in our warning-signs checklist.

What does good advice cost — and how should it be charged?

Fees vary widely and are rarely published, which makes comparison hard. Ask for a written estimate covering the whole engagement, including any practitioner, valuation or referral costs. Be cautious about fees calculated as a percentage of your debt — the ATO lists that as a warning sign. Compare: the Small Business Debt Helpline (1800 413 828) is free.

Where do we fit in?

We’re not pre-insolvency advisers. We’re a funder. We don’t negotiate with the ATO for you, we don’t sell restructures, and we don’t refer clients to liquidators for payment. What we can do is tell you, quickly and without a credit check, whether funding could pay the ATO in full — which is useful information to have before you sign up with anyone.

What does a good engagement look like, step by step?

If you do decide to use an adviser — pre-insolvency or otherwise — a sound engagement usually follows a recognisable shape:

1. A free or fixed-price first meeting where the adviser listens, asks for documents and explains, in general terms, the options available.
2. A written scope of work stating exactly what they’ll do, who will do it, and what it will cost — including any third-party costs such as valuations or practitioner fees.
3. Disclosure of relationships with liquidators, restructuring practitioners, lenders or valuers, and whether any of them pay the adviser.
4. A written options paper comparing paying (cash, plan or funding), restructuring, administration and liquidation for your situation, including what each does to director penalties and guarantees.
5. Your decision, after a second opinion if you want one.
6. Referral to registered professionals for anything that needs a registration — a tax agent for ATO negotiation, a registered liquidator for any appointment.

If an engagement skips straight from step one to a signed authority, a large upfront payment or a referral to a particular liquidator, slow it down. Your accountant can review any proposal before you sign, and the Small Business Debt Helpline (1800 413 828) can talk it through at no cost.

What questions do directors most often forget to ask?

• “What happens to my lockdown amounts?” — only payment remits them.
• “What happens to the guarantee I gave the landlord?” — insolvency processes generally don’t release it.
• “What will my suppliers and bank see?” — formal appointments are public.
• “What if I want to use SBR in future?” — there’s a 7-year bar after SBR or simplified liquidation.

Take the full question list into every first meeting.

Check your options before you engage an adviser

If you’re weighing up a pre-insolvency adviser’s proposal, talk to a funder first. There’s no credit check to enquire, your details aren’t sent around a group of lenders, and a real person will tell you plainly whether paying the ATO is achievable. Please give accurate figures so the answer is reliable.