Lockdown Director Penalty Notices are issued to director’s where their company’s have failed to lodge a BAS, IAS or SGC statement within the following timeframes:

  1. The company has lodged a business activity statement (BAS) or instalment activity statement (IAS) within three months of the due date; and
  2. SGC statements have been lodged within one month and 28 days after the end of the quarter the contribution relates to.

And, the Company has not paid the relevant amounts due.

The only option for directors to avoid personal liability in this situation is for the company to pay the debt within 21 days of the DPN being issued.

DPN’s can be issued on Estimates

If a company fails to report PAYG withholding, GST or SGC obligations by the due date, the ATO may make a reasonable estimate of the unpaid and overdue amount of the liability.

The director penalty provisions apply to these estimated liabilities. The estimate is due and payable by the company on the day the ATO gives the company the estimate notice. If the ATO has estimated the PAYG withholding, net GST or SGC liabilities it is treated as an unreported amount.