ARTICLE · 07 JULY 2026

Just Lodging Isn't Enough To Avoid A DPN

Worrells

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Directors who lodge their company's Activity Statements on time may still face personal liability through Director Penalty Notices if they underreport tax obligations. This article examines a critical but often misunderstood distinction in the legislation: timely lodgement alone doesn't prevent lockdown DPNs—directors must also accurately notify the Commissioner of the correct amounts owed.

AustraliaTax

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As many readers will be familiar, a Director Penalty Notice (“DPN”) is a notice from the ATO that pierces the corporate veil and places personal liability on a director for unpaid company tax debts.

This can include PAYG, GST, and Superannuation Guarantee Charge liabilities of the company. The commonly phrased warning to directors is to make sure that they complete their tax lodgements on time to avoid personal liability. Generalisations and common phrases are useful to simplify and communicate concepts and ideas, but they can be misleading and result in issues if the specific details aren’t reviewed and properly considered.

As a reminder regarding DPNs, there are two types:

Non-lockdown DPN; and

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