I understand that on October 9 the Australian Tax Office will begin to send out the first notices about unpaid superannuation obligations. These notices (since July 2012) have made company directors personally liable for any unpaid superannuation owed to their current or former employees.
On 29 June 2012 changes were made to the tax and superannuation laws that are intended to deter fraud and protect employee entitlements by:
o extending the director penalty regime and the estimates regime to apply to unpaid superannuation guarantee charge
o ensuring that directors cannot discharge their director penalties by placing their company into administration or liquidation when pay as you go withholding (PAYG withholding) or superannuation guarantee charge remains unpaid and unreported three months after the due date
o in some instances, making directors and their associates liable to PAYG withholding non-compliance tax (NCT), a tax equivalent to reducing PAYG credit entitlements where the company has failed to pay amounts withheld to the Commissioner.
(New directors should check that the company has been paying the required PAYG withholding and super guarantee for its employees, as they will become personally liable for any unpaid amounts 30 days after they become a director.)
Whilst I don’t have any data to indicate how many of SME’s may be in the firing line, Ashley King of Deloitte speculates that it could be in the thousands (here) I think it will be more likely in the tens of thousands (but I’m just an optimist like that…)
Given the commentary in the papers about the need of the Government to find cash to balance the books, I wouldn’t be surprised if they unleashed the ATO and blamed it on the poor state of the economy left behind by Labour. It would be interesting to know however what the new Minister for Small Business would think about all of this?
Adrian Hunter 