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ARTICLE · 17 OCTOBER 2008

ATO Flexes Its Debt Collection Muscle

Cooper Grace Ward
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If a company does not pay an amount claimed in a statutory demand within 21 days, the company is presumed to be insolvent. This presumption can be relied upon to wind the company up.

AustraliaTax
Rocco Russo
Rocco Russo
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If a company does not pay an amount claimed in a statutory demand within 21 days, the company is presumed to be insolvent. This presumption can be relied upon to wind the company up.

A statutory demand can be set aside where there is a "genuine dispute" about the debt claimed in the statutory demand or where there is "some other reason why the demand should be set aside".

In Deputy Commissioner of Taxation v Broadbeach Properties Pty Ltd [2008] HCA 41, the High Court held that a taxpayer cannot set aside a statutory demand for a tax debt merely because they have lodged an appeal against the assessment.

Background

The Commissioner of Taxation issued assessments to a taxpayer company and rejected the taxpayer's objection against the assessment.

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