1
Upfront engagement
Most matters start with a fixed-fee engagement for the restructuring phase.
5-6 Week Process
How Small Business Restructuring Works
A step-by-step guide to the SBR process, from initial assessment to debt release. Most businesses know their outcome within 5-6 weeks. New to SBR? Start with our complete guide to Small Business Restructuring.
20
Business days to develop plan
15
Business days for voting
87%
Plan approval rate
3 yrs
Maximum plan duration
The Process
Small Business Restructuring Process: Step-by-Step Timeline
Timeline Insight
Most outcomes are known within 5-6 weeks
The first 35 business days set the trajectory. Fast preparation and disciplined communication usually improve plan quality and voting confidence.
Prepare complete records early
Avoid timeline compression by having documentation ready before appointment.
Coordinate messaging consistently
Ensure creditors see a unified plan story throughout the process.
Keep trading stability
Maintain operations while the plan and vote run in parallel.
1
Week 0
Initial Assessment
Before formally appointing a restructuring practitioner, you will have an initial conversation to:
- Discuss your business situation and debt position
- Confirm you meet the basic eligibility criteria
- Understand the fixed fees (typically $15,000-$30,000 total)
- Ask questions about the process
2
Day 1
Practitioner Appointment
When you decide to proceed, the formal process begins:
- Board resolution to appoint the restructuring practitioner
- ASIC is notified within 1 business day
- Creditor enforcement action STOPS immediately
- Protection from Director Penalty Notices kicks in
- You continue running the business as normal
ATO garnishee notices and other enforcement action halt immediately.
3
Days 1-20 (20 business days maximum)
Restructuring Phase
The restructuring practitioner investigates your business while you continue operating:
- Practitioner reviews your financials and debt position
- You continue running day-to-day operations
- Together, you develop a restructuring plan
- Plan proposes a cents-in-the-dollar payment to creditors
- Must offer creditors a better return than liquidation
4
Days 21-35 (15 business days)
Creditor Voting
The proposed plan is sent to all creditors for a vote:
- Creditors receive the plan with full details
- 15 business days to consider and vote
- Requires 50%+ by dollar value to pass
- ATO generally supports viable plans (90%+ approval)
- You receive notification of the outcome
5
Up to 3 Years
Plan Execution
If the plan is approved, the execution phase begins:
- Make the agreed payments according to schedule
- Restructuring practitioner oversees the plan
- Business continues operating normally
- On completion, remaining debts covered by the plan are released
- You emerge debt-free (within the scope of the plan)
First 48 Hours of Small Business Restructuring: What to Do
When pressure is rising, early execution quality matters as much as strategy.
- Stop ad-hoc creditor promises and centralize communication
- Pull complete debt and lodgement data before first practitioner call
- Ringfence working capital for wages, tax compliance, and core suppliers
- Identify legal deadlines (DPN dates, court dates, garnishee activity)
- Lock a daily cash dashboard so decisions are made from live numbers
Documents to Prepare Before SBR Practitioner Appointment
Latest ATO integrated client account / debt summary
Aged creditor list and amounts owing
BAS and income tax lodgement status
Recent profit & loss, balance sheet, and cash flow
Employee entitlement position (wages, super, leave)
Major contracts, leases, and secured finance details
Cost Structure
How SBR Fees and Practitioner Payments Work
A practical breakdown of how fees are usually structured across the SBR lifecycle. For detailed fee data and ROI analysis, see our SBR cost guide.
2
Restructuring phase fee
Covers investigation, plan drafting, creditor communications, and statutory lodgements.
3
Plan administration fee
Applies if plan is approved and covers ongoing supervision/distributions.
4
Cash flow discipline
Directors need to maintain current obligations while the plan is being prepared.
Complexity Triggers
Common SBR Edge Cases: Disputed Debts, Personal Guarantees, and More
These do not automatically block SBR, but they usually require tighter preparation and evidence.
Edge Case
Disputed debts
Disputes can affect voting and timing; evidence quality becomes critical.
Edge Case
Personal guarantees
SBR addresses company debts, not all personal liability exposures.
Edge Case
Related entities
Intercompany balances and shared costs need clean separation.
Edge Case
Irregular lodgements
Rectification plans are often needed early to avoid eligibility failure.
SBR vs Voluntary Administration vs Liquidation: Decision Guide
A quick way to frame which pathway may fit before detailed legal/insolvency advice.
| Option | Usually Suitable When | Typical Result |
|---|---|---|
| SBR | Viable company, manageable operations, need formal debt compromise | Keep trading while compromising debt |
| VA | Complex stakeholder issues or uncertain business viability | Administrator takes control; broader restructure options |
| Liquidation | No viable turnaround and ongoing losses cannot be contained | Orderly wind-up and asset realization |
What Happens If the SBR Plan Is Rejected by Creditors?
If creditors don't approve the restructuring plan (which happens in about 14% of cases), the restructuring practitioner's appointment ends and the company returns to the directors' control.
At this point, directors need to consider alternative options, which may include:
- • Renegotiating directly with creditors
- • Voluntary administration
- • Liquidation
Start the process
Check Your Small Business Restructuring Eligibility
Check if your business is eligible for SBR in 60 seconds. Free, confidential, no obligation.
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