Director Penalty Notices

In June 2012 there were changes to the Director Penalty Notice (DPN) regime. Most importantly such changes now expose directors to automatic personal liability where either PAYG or SGC obligations remain unpaid and unreported for more than 3 months after the due date. Whilst the ATO will still have to send a DPN to recover on the debt – the director can no longer avoid personal liability in such circumstance by voluntary administration or voluntary liquidation. The important message is that at an absolute minimum directors should ensure that they comply with reporting obligations on-time.
Unfortunately there is still a status quo position being adopted by some directors and advisors. If you do receive a DPN, it is critical to seek professional advice urgently so that it can be determined what type of DPN you have received.

Liquidation is NOT a dirty word!

Whilst the term liquidation is frequently used, for many company directors or business owners it is still not always well understood and indeed feared. Whilst this is understandable, it is important to understand that this can also be a final part of the overall strategy when it is determined that a business (or company structure) is wound up. Critically directors and business owners need to seek professional advice (from appropriately qualified people – not unqualified consultants!!!) when they know the business is not heading in the right direction. In the main business failure is largely due to “micro” effects on the business, rather than “macro” factors as is sometimes reported. There is also the important consideration of trading whilst insolvent that directors unnecessarily expose themselves to when continuing to operate a business that is in financial distress. Take the pressure off yourself and get professional advice at the earliest possible stage so they can help you keep things under control.

Bankruptcy

Will you be able to keep the house? This is a question I get asked frequently by individuals that may need to contemplate voluntary bankruptcy. The short answer is YES, however it is important to understand that a bankruptcy trustee has an obligation to realise certain assets for the benefit of creditors. This includes equity you may have in the family home. It is possible for a co-owner or other family member to acquire your share of the equity in the family home from the bankruptcy trustee provided that the trustee believes it is a fair offer. It is important to examine each situation independently so that you are aware of how the bankruptcy trustee approaches determining the equity position. Being able to maintain the family home I find it quite often a high priority issue for individuals, particularly where there are children at school and other related factors.

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Personalised advice to put your mind at ease
during times of personal or business related financial turmoil.