Intergenerational tensions and tackling tax debt

Host – Grace Jennings-Edquist: [00:00:05] Is your business? Weighed down by tax debt. Or perhaps you’re struggling to juggle multiple generations in your workforce. They’re very different challenges, but both are hitting small and medium businesses right now. And in this week’s episode, we’re diving into each of them. First, leadership expert Marnie Brokenshire reveals why managing five generations under one roof is stretching managers thin. She’ll talk us through the emotional intelligence skills that can turn tension into teamwork, then Grow Capital’s Gus Gilkeson unpacks the surge in ATO debt this year and shares practical ways to ease the financial pressure on your business. From Sound Cartel, I’m Grace Jennings, and this is Business Essentials.

Are generational divides killing team performance?

Our first guest is leadership expert Marnie Brokenshire. Many workplaces employ staff spanning five generations, and as a manager, it can take some really good soft skills to manage these intergenerational teams. Marnie Brokenshire is the co-founder of Untapped Potential, a team of experts on culture and emotionally intelligent leadership. She says there’s often a lot of buzz about younger generations, and she wants business leaders to know that employees in their 50s and beyond often offer valuable knowledge and expertise. She also talks us through the soft skills needed to manage a team comprising a broad range of ages. Nicole Goodman interviewed Marnie about these intergenerational pressures. To kick things off, she asked Marnie why today’s particular mix of boomers, Gen X, millennials, Gen Z and early Alpha is causing some managers concern.

Marnie Brokenshire: [00:01:45] Well, it’s interesting because I think for the first time, we’re really starting to see five generations across a period of time that has seen some of the greatest change in the world. So what’s unique about today’s workforce is it’s not just the number of generations, but it’s the velocity of that social and technological change between them, the expectations and communication habits and the values of someone born in the 60s versus someone born in, say, 2015 are vastly different. We’ve sort of never really seen that level of difference before. So it’s not a concern per se, rather a complexity. And leaders need to rise to the challenge. So never before has a one size fits all leadership approach been more outdated.

Nicole Goodman: [00:02:40] Marnie people around the age of 50 are now considered old, and this is a topic that comes up every few years. What are your thoughts on older people in the workplace? And so much experience and value comes with age. Why is this still knocking around?

Marnie Brokenshire: [00:03:00] Yeah, it’s really frustrating and short sighted. 50 is an age group that I see as really sort of hitting their peak. Someone who has that many years of experience in their area of discipline is extremely experienced. They’ve built a deep expertise and a perspective that only comes with time. Some of the strengths we build as human beings, but also in our area of work, comes from repeated experience and honing our craft and continually working on our discipline, incorporating all of those key learnings to get better and better and better. You don’t get that without the depth of experience that comes with years, which in turn is age. I think that organizations that see it that way, or commentators in the media who are talking about it, that they have a limited view of the capability that’s sitting around you in the room. Smart organizations want more of it, not less, and smart organizations are learning to embrace the value of that experience because we learn best from where we’ve been and bringing it into how to shape and mold the future.

Nicole Goodman: [00:04:26] I agree with you. I mean, especially today when we think that 50 is the new 40 and 40 is the new 30. It’s crazy to think that 50 is old. As you say, people are coming into their own and I think workplaces are missing out if they just dismiss that age bracket.

Marnie Brokenshire: [00:04:44] I remember, you know, probably about 20 years ago when I used to do a lot of succession planning for high potential employees. The concept was if you hadn’t made your run for CEO by 40, you were never going to make it. And I think back now to that concept is quite horrifying, because actually, a lot of people who get to those sort of more senior C-suite level in organizations who, uh, don’t yet have a lot of experience and don’t have the right framework around them to be successful. They fail because that level of experience that you need to be able to navigate, especially the complexity that we’re faced with today, then that’s economic. It’s social, it’s political. You do need to be able to have some where for all about you. And that comes from, you know, years in the trenches.

Nicole Goodman: [00:05:36] No question. Absolutely no question. Well, we’re really talking about Gen X and boomers there. But let’s get back to some of the other challenges that we face when we look at a cross-generational workplace. And let’s talk about communication styles, because what distinguishes how gen alpha, for example, communicates versus a boomer.

Marnie Brokenshire: [00:06:00] So Gen Alpha are digital natives. Preferring short form visual asynchronous communication that is really tailored and individualized. So they’ve grown up in that world where algorithms have curated for them, and they’re used to receiving information in that way. Whereas Boomers and Gen X lend more toward formality, some clarity, live conversation, sort of an interactive two way where they have some agency in that communication, the way they’re receiving it, the opportunity to kind of interact with it. So Boomers and Gen X leaned more toward formality and clarity and live conversation, where they’ve got some agency and the opportunity to interact more directly with the way communication is coming at them. So these styles are not better or worse. They’re just different. The emotionally intelligent leader recognizes these preferences and adjusts their style accordingly. So adaptability is a core competency. It’s less about changing who you are and more about being tuned into who you’re speaking to, and how that person best receives the information for the greatest amount of engagement for them.

Nicole Goodman: [00:07:16] But without straying into stereotypes, particularly in technology. What does this look like in a workplace setting?

Marnie Brokenshire: [00:07:25] Look, I think sometimes tech adoption becomes a proxy for status. So you’ll sort of hear things or you’ll relate to people who say, you know, those who get it tend to move a bit faster. And I know me personally, I’m not the quickest tech adopter. Right. And then the other side of that argument is that, you know, those who don’t just get on board risk being left out. And people assume that older generations can’t keep up with tech. But actually that’s not really true. Sometimes, like me, I just need a little bit more time. So it’s usually not a capability gap. It’s what I say is a confidence and comfort gap. So boomers and Gen X may ask why. That’s most certainly me. You know, why do we need another platform or another app or another way to capture this data? While younger employees are typically asking why not? They’re there already. So emotional intelligence in leadership helps us bridge that. It allows leaders to meet people where they are and bring them along without judgment. The best workplaces are doing this by creating space for two way learning. So it’s not top down or bottom up, but it’s shared learning where those generations coming at that technological advancement are coming at it with their own perspectives. And the best of those two perspectives are being leveraged for the learning and adoption.

Nicole Goodman: [00:08:57] Well, another variable and you’ve said this very clearly are values and expectations. And we know that priorities more often than not do change as we age. But how does this impact teams in a workplace culture?

Marnie Brokenshire: [00:09:12] I love this question, Nicole. Generations don’t just have different life stages. They’ve grown up in different eras with really different defining events. And we just talked about tech. That being one of them. A Gen Z team member might see flexibility and mental health as non-negotiable. In fact, we know that to be true. While a Gen X leader may value resilience and loyalty. And we see this show up all the time in this ongoing work from home hybrid work debate. It is 100% a generational divide, but the emotionally intelligent response is to listen without defensiveness and engage in a real values based dialogue, where teams will feel psychologically safe to express what matters to them. So if we’ve got different values at the table, how are we allowing people to articulate what those values are and what their expectations are? And then it’s on the leader to create a space of mutual respect, where we’re really leveraging the learning of those different values and expectations that each generation brings. But we’re not driving silent resentment, so we’re not getting resentment from the generations that would prefer to work from home, from the generations who highly value working and face to face interactions, which I strongly advocate as an aside. But how do we get the mutual respect in valuing each of those so that it doesn’t create psychological safety risk?

Nicole Goodman: [00:10:50] The big one, of course, is generational stereotypes and biases, which we’ve touched on. We get very protective of our own generations, but some of us have no concern about criticizing some of the others. Tell us about what the impact is on psychological safety, on confidence, in workplace culture.

Marnie Brokenshire: [00:11:11] So I think stereotyping really weakens trust. But let me contextualize that first. I think sometimes it can be a bit fun. You will see on your social media feeds those fun TikTok things that are put together about, you know, back in my day, you know, we didn’t drink from a water bottle that was perfectly curated. We drank out of the hose on the street. Those things that they’re fun levels of reflection and we shouldn’t always take ourselves too seriously. It’s really great to look back. It helps us to look forward. But if we start to really stereotype that and and associate that with really defining who a person is, it weakens trust and it reinforces the US versus them narratives and undermines collaboration. So when a millennial is dismissed as entitled, or a boomer is seen as out of touch. You immediately reduce psychosocial safety in the team, and you have the potential to alienate certain people, or put certain people in boxes as being incapable or unable to do certain things. And that has absolutely a direct impact on performance outcomes. There is no question about that. Emotional intelligence teaches us to challenge our cognitive bias and respond with curiosity. So ask, what am I missing here? If my default position is to stereotype this person and assume that you know they’re out of touch, what am I missing? What questions have I not asked? How have I not really gotten down to understanding what that person’s values is, and how that fits, and what the space is for that in my team? It’s a powerful way to dissolve the bias, but also to strengthen team dynamic.

Nicole Goodman: [00:12:55] So the responsibility definitely lies with the individual, but certainly the team leaders and of course, culture from the top. With that in mind, mining, what do you believe is the answer to all of this? What can business leaders and managers do to keep so many different groups happy and engaged?

Marnie Brokenshire: [00:13:14] Well, it’s a lot of work and it requires intent and purpose. But you’ve heard me mention the words emotional intelligence a lot along the way. I think it’s the superpower and it’s the game changer. And it starts with emotionally intelligent leadership, which is trained. These are skills to be learned. And that that leadership is tasked with building an emotionally intelligent culture. I think this is the real game changer for the future. It’s the one thing AI can’t yet replace, and it is a competitive advantage for organizations that get it right. The number one objective in building that emotional, intelligent culture is to really inspire trust. So we want to inspire people, all people, equally and adapt your approach to meet people where they are. So I think there’s three quick things for your listeners to think about today. Practice real listening instead of just assuming. So let me not that cognitive bias stuff that we just talked about. Let’s not default to that. Let’s actually ask the right questions and lots of them and really listen. That’s number one. Number two provide choice and agency. So consider all points of view and stop developing one size fits all solutions. And this is a shout out to HR teams. Things have to be customized and individualized for them to really work. And my third tip is harness the strengths of every generation and recognize that true inclusion. So for all the, you know, conversations that are being had around boardroom tables about diversity and inclusion. Real inclusion includes generational diversity. It’s a really powerful factor that, if leveraged in the right way, can truly be a competitive advantage in culture, but also performance outcomes.

Host – Grace Jennings-Edquist: [00:15:12] That was Marnie Brokenshire, co-founder of Untapped Potential.

When the ATO comes knocking

Now to a very different pressure facing business leaders in 2025, one that’s set to continue into the new year. If your company has been struggling with a sizable debt to the Australian Tax Office, you’re certainly not alone. Ato debts topped $100 billion in March, leaving many small and medium businesses feeling the strain. Business adviser Gus Gilkeson is CEO and founder of Grow Capital. He joins us to break down the current challenges facing Australian enterprises, from supply chain collapses to tighter cash flow. He also shares practical advice on how to manage tax debt without risking collapse. But first, why have tax debts been higher this year compared to previous years? Gus explains to Jeff Waters.

Gus Gilkeson: [00:16:06] The latest measurement that’s been touted as around 105 $106 billion outstanding in Australia in tax debt. I think, you know, the result of the Covid standstill on tax collection and that sort of easing of chasing tax debts is now caught up and you’re finding businesses have fallen behind and now they’re trying really hard to catch up. And you’ve got the double whammy of, you know challenging trading conditions as well. So you’ve got outstanding liabilities. You’ve got high inputs, interest rates, you know the cost of living, all that type of stuff. And then you’ve got slowdown in a lot of industries in terms of actual activity. So when you look at that, the compression on that business is really challenging.

Jeff Waters: [00:16:50] It sounds like the ATO really isn’t in a position to crack down too hard because if they did, they’d put a lot of people out of business.

Gus Gilkeson: [00:16:59] Well, that’s that’s actually what’s happening. So the ATO ascending director’s penalty notices. I mean, I’ve heard of clients being sent director’s penalty notices for $80. Crazy stuff. So, you know, a simple phone call could have probably rectified. That would have cost more to send the letter. You know, I spoke to a client this morning who’s, you know, has a million and a half in outstanding tax debt, you know, as a result of one of their suppliers not paying what they should have paid. So there’s all of those sort of flow on effects. The supply went out of business, went into into administration. And then, you know, that debt has been passed on to them. They’re ultimately responsible for it. So you’ve got some crazy stuff happening out there at the moment.

Jeff Waters: [00:17:42] So what should I do if I have incurred a large or even moderate ATO tax debt? What should I do? What are the first steps I should take?

Gus Gilkeson: [00:17:54] Talk to your advisors is really important. So your accountant, your tax advisors, whoever you’re working with, if you don’t have one, you can find one. You know, the industry associations are really good. So find a qualified advisor and understand where you were at as a starting point. So you might think you owe 20,000. That could be 60,000. Who knows without the proper advice. So I think it’s really important to understand where you’re at. Don’t take the ostrich strategy. Sticking your head in the sand and ignoring. It’s not a great strategy. We’re seeing lots of challenges and businesses that get to us. They’ve taken that approach, ignored it, and they can’t get back on track because it’s too late. So, you know, if you get too far down the track, too far gone, there’s actually no way back other than going through a formal, you know, administration or potential liquidation or restructuring process. So you don’t want to get too far down the track. I think, you know, for a while, the tax office was being so aggressive that they didn’t even want to talk about payment plans with a lot of small businesses. But they now seem to be getting a bit better about that. But they do want to see more focus on those businesses being able to survive. So they want to see if you say, I want to pay that tax debt off over two years, they’ll ask you for a cash flow forecast. So you need to be able to provide some substantiation of how you’re going to do that. Whereas historically they didn’t require that.

Jeff Waters: [00:19:21] So it sounds like they’re softening up a bit.

Gus Gilkeson: [00:19:24] Yeah. Look I think they’re realizing it’s a it’s a big problem. It’s it’s a big challenge. I mean, more than 50% of businesses that we’re looking to fund have some form of tax debt. And it might only be small. But as I say, you know, we talk to a client this morning with 1.5 million. So, you know, there’s some big ones out there and, um, and they’re material.

Jeff Waters: [00:19:44] Is there any possibility at all you mentioned payment plans, but is there any possibility at all of negotiating with the tax office for some sort of relief or some sort of assistance?

Gus Gilkeson: [00:19:56] Yeah. Look, I think the ATO where it’s feasible, they will waive things like late payment fees and the like. And I think it’s really specific to a situation. If there’s a bona fide reason that a business hasn’t paid, you know, if one of if one of your clients has gone under or something like that, I think they’re fairly reasonable. I think communication is the key. The strategy of not talking to them, just ignoring it doesn’t really work. And so yeah, I think they’re reasonable. They’re aggressive, but, you know, reasonable if you can make commercial sense. So I think understanding where you’re at, understanding where your business is going and being able to demonstrate how you can build the ATO and the outstanding into that forward planning is really important.

Jeff Waters: [00:20:40] All right. So I find myself with a terrible tax debt. I’m struggling in my business because of the other sort of external issues that you mentioned earlier. What should I do In that case, is it just a matter of I’m going to have to go out of business?

Gus Gilkeson: [00:20:59] No, I don’t think it is. I think the the most important thing is to baseline your business and understand where you’re at from from a revenue, from an inputs and cost point of view, right down to expenditure. And when we talk about cash flow and running cash flow forecasts, there’s lots of different softwares that you can literally do this type of stuff at a press of a button now. So you’ve got fathom, float the spotlight. There’s a whole lot of technology that will just bolt straight onto your accounting software. These days, calcs are in a whole heap of others that can help you forecast in a really short period of time and look at what your business is doing. And that will not only forecast your profit and loss, but it will forecast your your balance sheet as well. So it’ll tell you if you’ve got gaps in terms of cash flow, in terms of liquidity. And so you can actually look at that. You can build in scenarios including paying the ATO, including, you know, maybe increased cost from your suppliers or tariffs, whatever they may be. And then look at that and look at what we might have to make some changes in your in your expense lines or in your supplier terms, whatever it is, to get to a point that your business can survive and can be sustained.

Gus Gilkeson: [00:22:15] And I think the ATO are reasonable in that they understand it’s much better for them. I mean, we have seen some crazy stuff, but I think they they understand it’s better for them to get paid over time, like any business, than not get paid at all. So yeah, I think the answer to your question is don’t rush into it. Just take a step back. Get your professionals to help you to look at where your business is at from a baseline cash flow and liquidity perspective. Look at what you need going forward and then plan for that. And you know, that might be, you know, some form of equity injection you need. It might be just restructuring your trade terms with some of your suppliers. It might be saying to the ATO, you know, we can’t pay this in one year, but we can pay it in two. And structuring all of your payments in line with a feasible cash flow.

Jeff Waters: [00:23:06] And the ATO will be reasonable, you say?

Gus Gilkeson: [00:23:09] Yeah, they appear to be rational around that type of thing. So if you can demonstrate that you have got a business that’s maintainable, sustainable, and you’ve actually put some effort into that and some thought into how you’re going to pay them, how you’re going to pay all of your other creditors, the fairly reasonable around that historically, what they they used to do is you could call up the ATO and say, look, I want a two year payment plan. And they’d say, how much do you want to pay? And you can say, I want to pay X. And they go, okay. And they’d send you a letter and everyone would agree on it. But no one had actually, you know, half the business hadn’t actually looked at if that was feasible or not. And then the payment plan would fall off a cliff three months later because something had happened in the business, and then they get really cranky with you and we’ll let you do it again. So I think they’ve they’ve learnt over the years that, you know, these are businesses sustainably need to look at cash flows, look at sensitivities and all that type of stuff. And they want a bit more thought put into them.

Host – Grace Jennings-Edquist: [00:24:10] That was Gus Gilkeson, CEO and founder of Grow Capital. Thanks for joining us on this week’s episode. Follow Business Essentials Podcast across social media and head to BusinessEssentialsPodcast.au for more. Business Essentials is a SoundCartel podcast. Producers are Nick Schildberger, Nicole Goodman and myself. Technical production is by Pete Letts. I’m Grace Jennings-Edquist thanks for listening. We’ll bring you more business essentials next week.