Director penalty notices

Director penalty notice (DPN) is a notice that the Australian Taxation Office (ATO) can send a director for tax liabilities a company has failed to pay. A Director Penalty Notice is issued under the Taxation Administration Act 1953 (Cth) and requires a director address the outstanding liabilities in the Director Penalty Notice within twenty-one (21) days.

If the penalties are not paid or remitted within the twenty-one (21) day period, the director becomes personally liable for payment of the liabilities and the ATO can then commence proceedings to recover the outstanding tax from the director personally.

In order to avoid personal liability a director must, within the prescribed twenty-one (21) day period either: