Tax Costs Overtake Credit as SME Cash Flow Pressure

A ScotPac SME Growth Index survey finds tax and compliance costs now weigh more heavily on Australian small and medium businesses than access to credit.

Updated on Nov. 11, 2026 in Corporate Finance

Tax Costs Overtake Credit as SME Cash Flow Pressure

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Are tax and compliance costs making it harder for your business to pay its bills?

Tax and compliance costs have overtaken access to credit as the leading cash flow pressure facing Australian small and medium enterprises, according to ScotPac's SME Growth Index survey. Twenty per cent of SMEs named tax and compliance costs as their main pressure, compared with 12.5 per cent who cited access to credit as a barrier.

Why it matters

Tax, supplier and payroll costs tie up working capital when bills fall due before customer invoices are paid. Businesses are also managing economic uncertainty, inflation and supply chain disruption linked to geopolitical conflict.

The ScotPac SME Growth Index survey, covering Australian small and medium enterprises, shows tax and compliance costs (20 per cent) edging out input and supply costs (19 per cent) and wages and payroll (17 per cent) as the top cash flow pressures. Access to credit was cited by only 12.5 per cent overall, with smaller SMEs at 15 per cent and larger SMEs at 10 per cent, and the source does not say how these shares will change.

The players

ScotPac

ScotPac is an Australian business finance provider that publishes the SME Growth Index, a regular survey of small and medium enterprise conditions.

The details

Tax, supplier and payroll costs place pressure on working capital when payments are due before customer invoices are settled. Australian businesses affected by disruptions linked to the Middle East conflict are planning measures to reduce its impact.

Survey findings published 11 November 2026, with SMEs planning to seek flexible supply chain funding over the next 12 to 18 months.

Corporate Finance Landscape

The findings sit within the ScotPac SME Growth Index, which tracks how Australian small and medium businesses manage working capital against tax, supplier and payroll obligations. Rising reliance on flexible supply chain funding, with 47 per cent of SMEs planning to seek it, suggests businesses are reshaping how they finance day-to-day operations.

Small business owners may need to review tax planning and working capital buffers, since tax and compliance costs are now the leading cash flow pressure. Those considering supply chain financing should weigh flexible funding options against their own timing of supplier and customer payments.

The takeaway

Managing the timing gap between paying tax, suppliers and staff and collecting customer payments is becoming central to small business survival. Reviewing when obligations fall due against incoming receipts can help businesses plan funding before pressure builds.