From cathropartners.com.au: As FY25 concludes, inflation and labour shortages significantly impact the economy, particularly in the Construction and Hospitality sectors, which account for 65.7% of formal insolvencies.

A recent interest rate cut may signal stabilisation in the cost-of-living crisis, but risks remain due to global uncertainties and a key regulatory change that will make interest on overdue ATO debt non-deductible starting July 2025.

Businesses need to be vigilant about accumulating tax debts, as unresolved debts may lead to severe repercussions such as Directors Penalty Notices.