Warning signs checklist: how to spot a tax-debt adviser to avoid

How to use this checklist

Print it, keep it next to the phone, and run through it during or after any conversation with someone offering to help with your tax debt — including us. It’s built from what the regulators and professional bodies say, in our own words, with the source for each point. One tick is a reason to check further. Several ticks are a reason to stop and get a second opinion. Prefer to click? Use the interactive adviser red-flag check.

The ten warning signs

#	Be wary if the adviser…	Where the warning comes from
1	Contacted you out of the blue, especially after a creditor started court action	ATO; ARITA; ASIC
2	Wants a fee calculated as a percentage of your debt	ATO
3	Suggests moving assets to another company, a relative or a new entity without full market value being paid	ATO; ARITA; ASIC
4	Says they know a “friendly” liquidator who’ll protect you, or a valuer who can under-value assets	ATO; ARITA
5	Asks you to give incorrect information to the ATO or ASIC, or to withhold or destroy records	ATO; ARITA
6	Offers to deal with the liquidator or trustee on your behalf	ATO; ARITA
7	Promises outcomes that sound too good to be true, or to fix everything for a lump sum	ARITA
8	Creates a sense of panic or urgency that discourages a second opinion	AFSA
9	Won’t put their advice in writing, or has no professional indemnity insurance	ARITA
10	Isn’t a registered liquidator, registered trustee, registered tax agent, lawyer or member of a professional body	ATO; ARITA; TPB

Why do these behaviours matter?

Cold contact after court action. When the ATO applies to wind up a company, the application is published. ASIC has warned about advisers who find directors through those notices. A caller who knows about your court case before you’ve told anyone is not necessarily dishonest — but you didn’t choose them.

Percentage-of-debt fees. The ATO names this specifically. A fee tied to the size of your debt rewards the adviser for the size of your problem, not for solving it.

Moving assets. This is the heart of illegal phoenix activity. ASIC says legitimate restructures have assets independently valued, with the new company paying that value. Penalties for directors can include large fines and up to 15 years’ imprisonment, and the same penalties can apply to anyone who aided or encouraged it. See illegal phoenix activity.

“Friendly” liquidators and valuers. A liquidator’s duty is to creditors and the law, not to the director. Anyone suggesting otherwise is misdescribing the role.

Records and information. Withholding or destroying records, or giving false information to authorities, can expose you to serious consequences. The ATO warns that following such advice could put you at risk of a fine, criminal conviction or even a jail term.

Urgency. AFSA lists creating an unnecessary sense of urgency as a red flag. Real deadlines exist — 21 days on a DPN or statutory demand — but a good adviser helps you use them calmly.

What should you do if you tick a box?

1. Pause. Don’t sign, pay or hand over documents.
2. Check registration — ASIC professional registers for liquidators and trustees, the TPB register for tax agents.
3. Ask for everything in writing, including total fees and who else gets paid.
4. Get a second opinion from your accountant or the Small Business Debt Helpline (1800 413 828).
5. Report concerns — the ATO phoenix tip-off line is 1800 060 062.

Hold us to the same standard

We’re a funder, not an insolvency firm. We don’t cold-call people with court actions, we never charge a fee based on a percentage of your debt, we’ll put everything in writing, and we’ll never suggest moving assets. If we ever fall short of this checklist, walk away — and tell us.

What does a trustworthy first conversation sound like?

It helps to know what good looks like, not just what to avoid. Across registered liquidators, tax agents, lawyers and lenders, a trustworthy first conversation tends to include:

• Questions before answers. They want your ATO statement, notice dates and lodgement status before suggesting anything.
• All the options. Paying, ATO plans, funding, restructuring and liquidation are each discussed — including the ones they don’t offer.
• The downsides. What each option costs, who controls the company, and what happens to director penalties and personal guarantees.
• Written follow-up. An email or letter setting out what was discussed and any fees.
• No pressure to sign. Real deadlines are explained, but you’re encouraged to get a second opinion.
• Proper credentials. A registration number you can check that day.

If a conversation has all of these, it’s very likely a professional one, whatever the outcome.

What if you’ve already signed something?

Don’t panic. Read what you signed, and check:

1. What you’ve authorised — information gathering, negotiation, an appointment?
2. What you’ve agreed to pay, and when.
3. Whether there’s a cooling-off or termination clause.
4. Whether any assets have moved. If they have, get independent legal advice urgently.

Then talk to your accountant or a lawyer, and to the Small Business Debt Helpline (1800 413 828). If you have concerns about the advice itself, the ATO’s phoenix tip-off line is 1800 060 062.

Want a straight conversation?

If you’d like to understand whether funding could deal with your ATO debt before you commit to anyone, see if you qualify. There’s no credit check to enquire, your details aren’t passed around lenders, and a real person will give you an honest answer — including when someone else is better placed to help. Accurate details make that answer more useful.