Surge in calls to Small Business Debt Helpline
New end-of-financial-year data from the Small Business Debt Helpline (SBDH) shows a record 7,237 small businesses sought help with managing debts and financial hardship in 2025–26. This is up 22 per cent on the previous year and a more than thirty-fold increase since the service began taking calls in 2020.
The main reason for contacting the service was overwhelmingly help managing debt accounting for 74 per cent of all contacts – up from just over half (52 per cent) when the Helpline launched in 2020. Sixty-four per cent of cases were linked to a change in the business owner’s personal circumstances, such as relationship breakdown, illness or an accident.
The data also shows that sixty-six per cent of cases seen by the Helpline last financial year involved a debt to the Australian Taxation Office (ATO), more than any other debt type, including business loans and supplier debt.
Financial counsellors on the helpline say the ATO does not offer enough flexibility to those struggling to pay tax debt with rigid hardship options and unrealistic time frames.
“The scale of ATO debt reflects a tax and hardship system that is not working for small businesses or the ATO. SBDH sees clients with genuine extenuating circumstances and financial hardship who, with a more flexible approach, could repay some or all of their debt, yet inflexibility sends them bankrupt,” said Anna Dooland, a financial counsellor on the helpline.
The data also points to business lending as a significant and growing source of unmanageable debt, with business loans from banks and non-bank lenders together making up 25 per cent of debt owed.
“Home and personal loans are legally required to be checked for affordability. Business loans aren’t, making them easier to get, and far harder to recover from if things go wrong,” said Ms Dooland.
“We regularly see small business owners handed high-cost loans secured against the family home that they could not afford. When it turns bad, they can lose the business and their home.’
Many of the lenders do not have adequate hardship provisions and are not members of the Australian Financial Complaints Authority (AFCA), leaving the small business borrower without access to binding external dispute resolution.
The record demand comes as the Helpline’s own funding is set to run out on 30 June 2027, with no confirmed funding beyond that date.
ENDS
Media contact: Maura Angle on 0418 334 121 or [email protected].
About the Small Business Debt Helpline
The Small Business Debt Helpline is a free, independent and confidential service providing financial counselling to small business owners in financial difficulty across Australia. The number to call is 1800 413 828.
About financial counsellors
Financial counsellors are qualified professionals who provide information, options and advocacy to people in financial difficulty. Their services are non-judgmental, free, independent and confidential.