Directors Beware

You could be personally liable for your companies ATO debt

Recent Changes – 27th June 2012

Recent changes to Director Penalty Notice provisions were passed by the senate on 27 June 2012. These changes will have a significant impact or any director who has received a Directors Penalty Notice.

Directors are now more liable

The aim of a Director Penalty Notice is to make directors liable for their company’s unpaid tax debt. As a director, you will no longer be able to avoid personal liability for a PAYG tax debt, which comes with a Director Penalty Notice, if the following applies:

Your debt is older than three months and or your debt was not reported to the ATO within three months of the lodgement date

As a director, you may also by liable for your company’s unpaid superannuation liability when you receive a penalty.

Directors, and associates of directors, may now also be liable for a new personal income tax liability. This will make directors and their associates potentially liable for a company’s unpaid PAYG withholding liability.

Do I have any options?

Yes. If your business has a tax debt or you have received a Director Penalty Notice it is vital that you seek professional advice, we have various options you may wish to consider simply call us on 1300 818 575.

What If I Ignore the Notice?

There can be significant consequences for not complying with the ATO’s notice; this can include losing personal assets such as cars, property or shares.

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