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Barker & Jennings Update, November 2011

November 24 2011

Directors Penalty Notices – Employee PAYG and Superannuation proposed legislation before Parliament amending the Directors Penalty Regime was yesterday!

The proposed legislation was to include amendments to:

  • allow the ATO to immediately (without first issuing a Director Penalty Notice) commence recovery of all director penalties when the company’s unpaid liability remains unpaid and unreported three months after the due date
  • impose a personal liability on directors for unremitted superannuation contributions, in addition to unpaid PAYG;

What does this mean? For now those company directors who are not ensuring that their compulsory superannuation (the 9%) and tax deducted (PAYG) from employees wages are paid on time have had a significant threat to their personal liability stayed but not alleviated.

If you are the director of a company that is not remitting its superannuation and its employee tax (PAYG) and is allowing the debt to build up, then you are still at risk because if you are not paying your BAS (PAYG & GST) and superannuation liabilities, then your company is trading in an insolvent state and you may well find your company being liquidated.

For more information contact Ron on 03 5333 3915 or email