Australian Business Insolvency Guide 2020

If your business is facing the prospect of insolvency or liquidation you need to know all the facts. The Australian Business Insolvency Guide 2020 sets out everything you need to know in plain English. If you are under pressure from the ATO or other creditors you need to act now and become fully informed about your obligations and your rights before it’s too late. You can purchase The Australian Business Insolvency Guide 2020 on Amazon.com for $28.95, or download the guide as our gift when you subscribe to our free newsletter, Business Insolvency Help.

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Director Penalty Notices

What is a Director Penalty Notice?

Under certain circumstances, the Australian Taxation Office (ATO) can force the directors of a company which is unwilling or unable to meet certain tax and other obligations, to personally pay those debts. This is achieved with the issuance of a Director Penalty Notice. Those obligations include PAYG (Withholding) Tax, and unpaid employee superannuation entitlements. You should know that a Director Penalty Notice can be equally issued to Shadow or de facto directors.

The laws governing the Director Penalty Notice regime were strengthened significantly in June, 2012. The net result of this is, it is easier for directors to become personally liable for the debts of a company. The ATO commences the processes of recovering money owed by a company, from its directors, by issuing a Director Penalty Notice. There are two types of Director Penalty Notices that you need to know about.

1. Non-Lockdown Directors Penalty Notices

The first type is the “non-lockdown” Directors Penalty Notice. Non-lockdown notices are issued to company directors that have lodged its Business Activity Statements or Instalment Activity Statements, but the debts remain unpaid. The notice gives directors 21 days to take certain actions (covered later in this guide) which results in the penalty being “remitted” i.e. cancelled.

2. Lockdown Directors Penalty Notices

The second type is “lockdown” Directors Penalty Notice (also referred to as the three-month lockdown provision). Lockdown notices are issued to company directors where a company has failed to lodge its Business Activity Statements or Instalment Activity Statements within three months of their due lodgement date. In this case, directors become automatically liable for the debts to the ATO.

What Action can the ATO Take?

The Australian Taxation Office is not your standard creditor, and enjoys wide powers to recover debts that other creditors simply do not. Here are some sobering facts that you need to consider;

Garnishee Notices (section 260-5, Tax Administration Act)

The Australian Taxation Office (ATO) has the power to issue a Garnishee Notice to any third party that owes or holds (e.g. the company’s bank) any money on behalf of the company. A Garnishee Notice requires the third party to pay money directly to the ATO.

Director Penalty Notices

What is a Director Penalty Notice?

Under certain circumstances, the Australian Taxation Office (ATO) can force the directors of a company which is unwilling or unable to meet certain tax and other obligations, to personally pay those debts. This is achieved with the issuance of a Director Penalty Notice. Those obligations include PAYG (Withholding) Tax, and unpaid employee superannuation entitlements. You should know that a Director Penalty Notice can be equally issued to Shadow or de facto directors.

The laws governing the Director Penalty Notice regime were strengthened significantly in June, 2012. The net result of this is, it is easier for directors to become personally liable for the debts of a company. The ATO commences the processes of recovering money owed by a company, from its directors, by issuing a Director Penalty Notice. There are two types of Director Penalty Notices that you need to know about.

1. Non-Lockdown Directors Penalty Notices

The first type is the “non-lockdown” Directors Penalty Notice. Non-lockdown notices are issued to company directors that have lodged its Business Activity Statements or Instalment Activity Statements, but the debts remain unpaid. The notice gives directors 21 days to take certain actions (covered later in this guide) which results in the penalty being “remitted” i.e. cancelled.

2. Lockdown Directors Penalty Notices

The second type is “lockdown” Directors Penalty Notice (also referred to as the three-month lockdown provision). Lockdown notices are issued to company directors where a company has failed to lodge its Business Activity Statements or Instalment Activity Statements within three months of their due lodgement date. In this case, directors become automatically liable for the debts to the ATO.

What Action can the ATO Take?

The Australian Taxation Office is not your standard creditor, and enjoys wide powers to recover debts that other creditors simply do not. Here are some sobering facts that you need to consider;

Garnishee Notices (section 260-5, Tax Administration Act)

The Australian Taxation Office (ATO) has the power to issue a Garnishee Notice to any third party that owes or holds (e.g. the company’s bank) any money on behalf of the company. A Garnishee Notice requires the third party to pay money directly to the ATO.

What You’ll Learn

17 Chapters

237 Pages

The Australian Business Insolvency Guide 2020 has been written with real business owners in mind. The Guide cuts through the legalistic mumbo-jumbo that characterises the Australian business landscape and provides the kind of no-nonsense, plain English resource that business owners facing the prospect of insolvency so desperately need.

Filled with real-world scenarios to make it easy to understand, you’ll become better informed about the basics of:

  • Business Insolvency
  • Voluntary Administration
  • Company Liquidations
  • Deeds of Company Arrangement
  • Directors Liability
  • Personal Bankruptcy
  • And more…

Written in collaboration with some of Australia’s leading insolvency experts, Australian Business Insolvency Guide 2020 is your #1 weapon in knowing your rights and obligations as an owner or director of a business grappling with insolvency.

TAKE A LOOK INSIDE

Australian Business Insolvency Guide gave me the information I needed and the confidence to move forward in a very difficult situation.

John Doe

I just wish I'd come across this guide before I declared bankruptcy. I think I could have avoided the entire thing!

Dan Waldo

I had some "expert" telling me to go bankrupt. Luckily, I found Australian Business Insolvency Guide before I did that. Awesome info!

Jane Smith

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