ATO garnishee notice: what to do when the money disappears

What a garnishee notice means

When money disappears from a business account, it is often because the ATO has moved from reminders to recovery. The ATO says it can issue a garnishee notice to a bank, a trade debtor, or another person or business that holds money for you, and that it can use firmer action when debts stay unpaid or payment plans keep failing. ([ato.gov.au](https://www.ato.gov.au/individuals-and-families/paying-the-ato/if-you-don-t-pay?anchor=Strongeraction1&utm_source=openai))

For a construction business, that can cut straight into wages, supplier payments, plant hire, and BAS cash. The important point is simple: this is not a dispute to park for later. It is a live cash-flow problem that can keep moving if you do not identify the notice, the amount, and the next step today. ([ato.gov.au](https://www.ato.gov.au/individuals-and-families/paying-the-ato/if-you-don-t-pay?anchor=Strongeraction1&utm_source=openai))

Get the notice and check the figures

Start by getting the actual garnishee notice and matching it to your ATO account, bank statement, and any recent letters. The ATO’s receivables policy explains that a garnishee can require payment immediately, or by a set date or instalment, and it can be aimed at money now held or money that may be held in future. ([ato.gov.au](https://www.ato.gov.au/law/view/pdf/rmp/rp0012v4.pdf?utm_source=openai))

Do not rely on memory or a quick phone summary. Check which account was targeted, whether the notice is for a lump sum or instalments, and whether the figures align with your records. If the debt looks wrong, note the difference and raise it with the ATO or your adviser, but keep the conversation grounded in the document itself. ([ato.gov.au](https://www.ato.gov.au/law/view/pdf/rmp/rp0012v4.pdf?utm_source=openai))

Source: Official guidance

Call the ATO today

The ATO says you should contact it before the due date if you cannot pay, and that it will discuss your payment options and financial situation. It also says it can consider firmer recovery action when a taxpayer will not engage, cannot pay, or keeps defaulting on agreed arrangements. ([ato.gov.au](https://www.ato.gov.au/api/public/content/0-92face79-c5cb-4b66-8324-b6acaacbae9c?utm_source=openai))

That makes today’s call important. Be ready with a realistic cash position, the amount you can pay now, and what would break if you promised too much. A payment arrangement is only useful if it fits the business you actually have this week, not the one you hope will exist after the next progress claim lands. ([ato.gov.au](https://www.ato.gov.au/api/public/content/0-92face79-c5cb-4b66-8324-b6acaacbae9c?utm_source=openai))

Build a payment proposal that can survive

Before you speak again, write out the next fortnight of cash movement. List wages, rent, materials, fuel, subcontractors, tax, and any other fixed outgoings beside expected receipts. Business.gov.au’s cash-flow guidance is useful here because it forces the same question the ATO will ask: can the business meet current commitments as well as old debt? ([ato.gov.au](https://www.ato.gov.au/api/public/content/0-92face79-c5cb-4b66-8324-b6acaacbae9c?utm_source=openai))

If the numbers do not work, say so early and ask for advice. A payment arrangement does not remove the debt, and interest can keep building on overdue amounts. The practical benefit of an honest proposal is that it gives the ATO something workable to assess and gives you time to protect the rest of the business. ([ato.gov.au](https://www.ato.gov.au/individuals-and-families/paying-the-ato/if-you-don-t-pay?anchor=Strongeraction1&utm_source=openai))

Get advice before the next debit hits

If the notice sits beside other warnings, such as missed lodgements, repeated defaults, or a director penalty notice, the risk is wider than one garnishee. The ATO says directors can become personally liable for some company tax debts, and its information-gathering guidance shows it may take action without warning in some situations. ([ato.gov.au](https://www.ato.gov.au/individuals-and-families/paying-the-ato/if-you-don-t-pay?anchor=Strongeraction1&utm_source=openai))

Today’s next step is clear: get the notice, call the ATO, make a payment proposal you can actually keep, and then get advice on the wider debt position. If you need help managing creditor pressure around the tax debt, call CRP today about creditor management. CRP coordinates independent qualified professionals and does not promise outcomes. This article is general information only. ([ato.gov.au](https://www.ato.gov.au/api/public/content/0-92face79-c5cb-4b66-8324-b6acaacbae9c?utm_source=openai))