What is a Director Penalty Notice?
If a company falls behind in the payment of its tax debts, the Australian Taxation Office (ATO) can issue a Director Penalty Notice.
The Notice is issued under Section 222AOE of the Income Tax Assessment Act to any or all directors in respect of PAYG withholding amounts - that is, the tax amounts deducted from employee wages and entitlements but not remitted to the ATO.
If the Director Penalty Notice is not complied with within the 14 days allowed, the director(s) will become personally liable for the outstanding debt of the company as listed in the notice.
If you've got a tax debt, this means your personal assets are at risk.
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