The Answer to Your Director Penalty Notice
As a director embarking on a new business venture, you become assigned a number of
responsibilities. One of the most important is becoming responsible for your company’s taxation obligations.
But what does this mean?
Every Australian business has a legal responsibility to file its Business Activity Statement (BAS) every quarter. If you fail to lodge your BAS within 3 months of its due date, then the company director(s) will become personally liable for the PAYG and superannuation component. To collect these amounts from the director (personally), the Australian Taxation Office, has the power to issue a Directors Penalty Notice (DPN) with a lock down notice.
If your company has lodged its BAS within 3 months of their due dates and the
ATO issues a DPN, then you can avoid personal liability if within 21 days you
– Repay the company’s full outstanding tax debt from their own pocket; or
– Appoint a liquidator to cease company operations; or
– Appoint an administrator to enter the company into voluntary administration.
In order to know which course of action is most suitable as a director, you need to consult with an insolvency specialist. At CRS Insolvency Services, our consultants are all highly trained in corporate insolvency assignments. We will provide professional advice to help you make the best decision for your company while avoiding personal liabilities. Contact CRS Insolvency Services on 1800 210 073 for 24/7 free expert advice now.