29 July 2011
Draft legislation released last month will see Directors become personally liable for the superannuation guarantee (SG) payments of employees. The change is part of a suite of reforms designed to target phoenix companies but the reforms, if enacted, will have a much broader impact.
A phoenix company is the deliberate liquidation of a company to avoid paying liabilities including employee entitlements. The business then 'rises' and continues operations through another corporate entity, controlled by the same person or group of individuals, often with a very similar name and free of the debts.
The legislation, if enacted, will also give the tax office the power to pursue directors where PAYG and SG remain unpaid and unreported for more than three months beyond the due date.
Contact us for more informaton about this draft legislation on 02 9957 4033.
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This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.