ASIC’s insolvency statistics show that around 14,000 companies entered external administration for the first time in 2025–26, a modest fall on the year before. Construction and hospitality remain the hardest hit, together accounting for roughly four in ten.
Two other numbers stand out. The ATO issued more than 84,000 director penalty notices in 2024–25, and small businesses account for around $36 billion of the ATO’s collectable debt. Directors can become personally liable for unpaid PAYG withholding, GST and super, often sooner than many realise.
The good news is that early action can make a real difference. ASIC’s recent review of voluntary administrations found that around 44% resulted in creditors accepting a deed of company arrangement, and almost 90% of completed deeds paid unsecured creditors a dividend.
My practical takeaway for business owners: if cash flow is tight, keep lodging on time, take advice before a DPN arrives, and look at safe harbour while you still have options. A conversation now usually costs far less than a liquidation later.
ASIC’s media release on its voluntary administration review: https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-144mr-asic-review-provides-insights-into-voluntary-administration-and-deed-of-company-arrangement-outcomes
If your business is facing financial pressure, contact Angelo Conti, Managing Principal at Madgwicks, angelo.conti@madgwicks.com.au for practical advice on your options and the steps you can take to manage risk. Acting early can make all the difference.
