This latest success story is testament to our extensive experience in Director Penalty Notice Defence. Our client, a former company director, was facing legal action from the Australian Taxation Office (ATO) over a disputed director penalty notice. But we defeated the claim. If you’re wondering how to get out of a fixed penalty notice, read on to find out how we won.
Although our client was no longer a director of the company involved, he could still be held liable for liabilities that occurred both before and after resigning as a director of the company.
The ATO were arguing that our client was personally liable for company debts due to an unanswered director penalty notice (DPN). This is a serious issue. When a company struggles financially, directors can sometimes be held responsible for unpaid tax debts, even if they’re no longer a director of the company involved. The ATO took our client to the District Court, in an attempt to enforce this insolvency claim.
What is a Directors Penalty Notice?
Company Directors are responsible for ensuring that the company’s tax and superannuation obligations are reported and paid on time. If the company does not pay certain liabilities by the due date. the ATO can recover these amounts from the director personally as a current, or former, company director.
A DPN usually gives you 21 days to act. If the DPN is ignored it is assumed by the ATO that the director has not acted to defend or pay the claim.
How to appeal a fixed penalty notice
Having dealt with many director penalty notices before, we scrutinised the matter in detail, especially the notice itself and the law being relied upon to serve it on the former director. Through this process, we found multiple technical defects in the notice that raised serious legal questions.
Director Penalty Notice Defence
To put the ATO’s case under pressure, we not only filed a defense based on these defects but also requested further particulars of their claim. Our Strategy was simple – when the ATO took a closer look at their own paperwork, they might realise the flaws in their case.
The Outcome; A Win For Our Client
The ATO reviewed the notice carefully. While they never outright admitted they were wrong, they quietly offered to drop the case. For our client, this was an enormous relief, what started as a serious financial and legal threat was now off the table.
A Word From Bruce
“DPNs often come up in Insolvency cases, and our team knows exactly how to navigate them. The ATO rarely makes mistakes, but in this instance, they did and our attention to detail made all the difference”
If you’re a director facing an ATO claim, or you have concerns about DPNs, don’t wait until it’s too late. contact Stratos Legal today, we’re here to help.
For more Information on Insolvency follow the links provided
