Director penalty notice questions: your questions answered
In plain English
A director penalty notice makes company PAYG withholding, GST or super debt your personal debt, on a 21 day clock that runs from the postmark. The specific questions directors ask once the notice is in their hand.
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How do I know if a DPN has been issued to me?
The only reliable sign is the notice itself: the ATO posts a director penalty notice to your address on the ASIC...
Answer →What does a director penalty notice look like?
A director penalty notice is a formal, dated letter from the ATO addressed to you personally as a director, not to the...
Answer →When do the 21 days start on a DPN?
The 21 days start on the date the ATO posts the notice to your address on the ASIC register, which is normally the date...
Answer →What happens if you ignore a DPN?
If you do nothing for 21 days, the company's unpaid PAYG withholding, GST and SGC becomes personally recoverable from...
Answer →Can a DPN include GST?
Yes. A director penalty notice can include the company's net GST , along with luxury car tax and wine equalisation tax,...
Answer →Am I liable for old tax debts as a new director?
Yes, after 30 days. Once you have been a director for 30 days you become personally liable for the company's unpaid...
Answer →What if only one director pays the DPN?
If one director pays the full amount, the penalty is satisfied for every director, because each director's liability...
Answer →I was only a director on paper for my partner's company. Am I liable?
Usually yes. The law does not distinguish between a working director and a director in name only.
Answer →DPN in hand, or worried one is coming?
The 21 days move fast. A specialist who handles DPNs weekly can tell you which options are still open.
Can I get a DPN for a deregistered company?
Yes. Deregistering a company does not cancel a director penalty.
Answer →Does small business restructuring protect me from a DPN?
Partly. If a restructuring practitioner is appointed within 21 days of the date on a non-lockdown DPN, the director...
Answer →Does safe harbour protect me from a DPN?
No. Safe harbour under section 588GA of the Corporations Act protects a director from civil liability for insolvent...
Answer →How many DPNs does the ATO issue each year?
The ATO issued 84,529 director penalty notices in 2024-25 , to directors of roughly 64,000 companies.
Answer →Can the ATO remit a director penalty?
Not in the way it remits interest or late lodgement penalties.
Answer →How do I lodge a DPN defence?
In writing, to the Commissioner of Taxation. The ATO asks directors to submit a written defence that clearly states...
Answer →I got a director penalty warning letter. What now?
It is not a director penalty notice, but it is the last step before one.
Answer →Does a DPN lead to bankruptcy?
It can, but it is not automatic and most do not. A director penalty notice makes you personally liable for the...
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