When individuals find themselves in difficult personal financial problems, they fear bankruptcy. What seems not to be understood is that bankruptcy is intended as a relief, not a punishment, for people in these circumstances. At the time when a person declares their bankruptcy, the whole of their indebtedness is "wiped out". What a relief!

It only lasts for three years, and the restrictions are few. Generally speaking, the impact is Indiscernible. So, if you are served with a bankruptcy Petition,take proper advice as it may be your best option and an ATO bankruptcy is no exception. Tax debts are no different to any other debt.

DEEDS OF COMPANY ARRANGEMENT & ARRANGEMENTS UNDER THE BANKRUPTCY ACT MAY BE EMPLOYED TO AVOID BANKRUPTCY AND IN THE CASE OF A COMPANY A WINDING UP

There are options available to individuals in difficult financial circumstances and corporations are the same boat. It is open to an individual and a company to propose (in a formal way) an arrangement with their creditors by appointing a bankruptcy trustee (in the case of an individual) or an administrator ( in the case of a company) and proposing deal/arrangement  with creditors which, if accepted by the requisite majority, the the individual  and or the company and can proceed on under that arrangement (say payment by instalments).

Payment by instalments, coupled with a reduction to, say 50 cents to the dollar, thereby avoiding Bankruptcy  in the case of an individual and a winding up in the case of a company .

Keep in mind the there are legitimate and legal mechanisms to;

Avoid liquidation

Avoid receiverships of various kinds

in fact; avoiding financial problemms in general.