PERSONAL LIABILITY FOR GST STARTS 1 APRIL
Like PAYG, non-payment of GST will attract personal liability for Directors under the Director Penalty Regime in 2 ways:
- Fail to lodge Business Activity Statements (BAS) and Income Activity Statements (IAS) within 3 months of the due date for lodgement.
- Lock down Director Penalty Notice will attach Personal Liability to a Director immediately and regardless of the appointment of a liquidator, the liability will be unavoidable.
- Lodge BAS and IAS within 3 months of due date for lodgement but not remit payment
- Personal Liability for Company tax liability will be avoidable if a Director Penalty Notice is acted on within the 21 day period allowed.
This change to the Law passed both houses of Parliament on 17 February 2020 under the Treasury Laws Amendment (Combating Illegal Phoenix) Bill 2020
Other Significant Changes in the Bill
- Introduction of the Creditor-Defeating Disposition s588FBDB (the Phoenixing Provisions)
- Enables ASIC, at its discretion, to void phoenix transactions upon request by a Company liquidator, if such a transaction occurred when a company was insolvent and it occurred during the 12 months immediately preceding the date of liquidation.
- ASIC may then order the return of the property subject of the disposition to the insolvent Company.
- ASIC may order the person to pay an amount that in ASIC’s opinion, represents some or all of the benefits that person received directly, or indirectly, because of the transaction.
- In making these types of orders, ASIC must have regard for the conduct of the company and its officers, the circumstances, nature and terms of the disposition, the relationship between the company and the person and any other relevant matter.
- The Court may set aside the ASIC order if application is made within 60 days of the order issued or if the Court is satisfied the order should not have been made.
- The new amendments also expand Director and Officer’s Duties to Prevent Creditor-Defeating Dispositions s.588GAB and also not to procure or encourage such transactions – which appears to be aimed at (un)licensed advisors S588GAC
- No Backdating of Director Resignations s203AA
Director resignations will take effect
- If ASIC is notified within 28 days that the person stopped being a director
- Otherwise, the day written notice is lodged with ASIC.