$4.3 billion late: Construction tops ATO chart – realestate.com.au

Traders, builders and developers dominate the list of Australia’s worst tax debts, with construction companies racking up $4.3 billion in unpaid taxes and superannuation over the past financial year.

This staggering figure was revealed in a breakdown by the Australian Taxation Office, which found that more than 14,600 construction companies were classified as ‘disengaged taxpayers’ last financial year – after failing to engage with authorities to pay off their debts.

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The $4.3 billion covers debts over $100,000 that are more than 90 days past due, excluding construction companies with active payment plans or insolvency, liquidation or disputed debt activity.

An ATO spokesperson told The Courier-Mail “the majority of companies’ unpaid tax liabilities relate to GST, pay-as-you-go deduction and the Pension Guarantee Surcharge. These are amounts deducted from employees or customers but not passed on to employees or the government.”

The ATO has now stepped up action against company directors across all industries who are failing to resolve $50 billion in unpaid GST, PAYG withholding and mandatory pension payments.

“Where there is evidence of deliberate non-payment and a risk to revenue, more stringent actions such as DPOs (departure orders) may be applied to prevent the taxpayer from leaving Australia until the liability is addressed,” the ATO spokesperson said.

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Unpaid GST liabilities, including liabilities arising from property transactions or developments, are among the types of significant debt, the ATO said.

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“Unpaid GST liabilities, including liabilities arising from real estate transactions or developments, are among the types of significant debts that could result in the Commissioner issuing a no-departure order (DPO).”

Over the past six months, the ATO has stopped 21 people at the border, preventing them from leaving the country due to business-related debts – more than the total number of DPOs issued in the previous financial year.

The tax authorities have also issued director penalty notices, seizures, referrals to credit reporting agencies and winding-up notices.

Asked whether a person’s assets, including property, were taken into account when assessing their ability to pay, the spokesperson said: “The ATO takes a holistic view of their financial position, including assets, income and general circumstances to determine the recoverability of debts and the most appropriate course of action.”

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The ATO’s focus is entirely on “ensuring that taxpayers meet their obligations. Source: ATO.

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A consistent position was taken across all sectors, with the focus squarely on “ensuring that taxpayers meet their obligations”.

While the construction sector led the way in 2024-2025 with 14,674 uninvolved taxpayers, the next highest was professional, scientific and technical services with 4,850.

Accommodation and food services followed with 4,195, then administrative and support services with 3,290, and transport, mail and storage with 2,936 – rounding out the top five sectors with the worst recoverable tax debt.

The ATO said each case would be assessed on its merits and individual circumstances before determining the most appropriate action.

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