Managing Rising Fuel Costs - ATO Support and Planning Considerations

Rising fuel costs continue to place pressure on both businesses and individuals, particularly those with transport, logistics, or high operational overheads. In response, the ATO has introduced a range of support measures designed to provide short-term relief and flexibility.

While these measures are helpful, they are best viewed as part of a broader financial strategy rather than a standalone solution.

ATO Support Measures

The ATO has acknowledged the impact of increased fuel prices and is offering targeted support for eligible taxpayers experiencing financial pressure. Key measures include:

Payment Plan Flexibility
The ATO is allowing more flexible payment arrangements for tax liabilities, enabling businesses and individuals to spread payments over time. These plans are tailored to cash flow capacity and can be adjusted as circumstances change.

Deferrals and Lodgement Support
In certain cases, the ATO may provide deferrals for lodgement and payment obligations, helping to ease short-term pressure.

Remission of Interest and Penalties
Where financial difficulty can be demonstrated, the ATO may remit or reduce interest charges and penalties associated with overdue tax debts.

What This Means in Practice

For many clients, these measures provide temporary relief rather than long-term resolution. Entering into a payment plan or deferral arrangement can assist with immediate cash flow, but it also requires careful management to avoid compounding obligations.

Importantly, the ATO continues to expect active engagement. Early communication and a clearly defined plan are key to accessing support and maintaining flexibility.

Strategic Considerations

In the current environment, rising costs - fuel included - should prompt a broader review of financial structures and strategy. Areas to consider include:

• Reviewing pricing models and cost recovery mechanisms
• Assessing operational efficiency and expenditure
• Ensuring tax positions and structures remain appropriate
• Forecasting cash flow under different cost scenarios

The focus should remain on maintaining control and optionality, rather than relying solely on reactive measures.

How We Are Supporting Clients

At LHP Partners, we are working closely with clients to navigate these pressures - whether through engaging with the ATO on their behalf, structuring payment arrangements, or incorporating these considerations into broader tax and financial strategies.

With the 15 May ATO deadline approaching, this is a critical window to not only address any immediate pressures, but to take a broader view of your tax position.

Rising costs often create opportunities to reassess structures, optimise outcomes, and ensure your strategy remains aligned with your long-term objectives. Left unaddressed, however, they can also lead to missed opportunities and unnecessary exposure.

We are currently undertaking targeted tax planning reviews with clients to identify opportunities, manage upcoming obligations, and position them effectively ahead of year-end.

If you would like to review your position or explore a tailored tax strategy before the deadline, we recommend getting in touch with our team in the coming weeks.