A Bill passed by the Senate in February 2020 will mean directors can be personally liable for unpaid company GST.
Currently directors are personally liable for unpaid superannuation and withholding tax. The personal liability for directors is now heightened with the long anticipated Treasury Laws Amendment (Combating Illegal Phoenixing) Bill 2019 being passed by the Senate (awaiting assent).
Directors will soon become personally liable for unpaid GST, Luxury Car Tax and Wine Equalisation Tax liabilities in certain circumstances.
Now is the time to address any inadvertent errors or known outstanding debts. If these are not corrected promptly, directors will become personally liable.
Directors should also be reviewing their asset protection strategies to reduce and limit their risk.
What are the consequences of the new Bill to businesses and directors?
- Directors can become personally liable for GST, Luxury Car Tax and Wine Equalisation Tax liabilities in certain circumstances.
- The Australian Taxation Office can retain refunds where a taxpayer has failed to lodge a return or provide other information that may impact the amount of a refund.
- The Bill prevents directors from improperly backdating resignations or ceasing to be a director when this would leave a company with no directors.
- The Bill provides further powers to Liquidators and the Australian Securities and Investments Commission to prevent the unlawful transfer of assets during illegal phoenix operations.
Seeking professional advice early is the key
If you think you may be affected by the new laws or you want to review your asset protection strategies, you can contact us by telephoning our office on (07) 3220 2929 or emailing us at firstname.lastname@example.org.