Recently, there has been a lot attention placed on Director Penalty Notices (DPNs) and payment arrangements no longer being an option within the 21 Day period. However, after a bit of research, this has not been the case for over a decade. The current legislation (1 July 2010) does not and has not at any time provided an option to remit the penalty by entering into a payment arrangement.
So it appears its not new. What is new is that since March the ATO has been sending warning letters to Directors, and as per the DPN warnings circulating on LinkedIn, they should be taken seriously: https://lnkd.in/gnmHJji5
Its also worth pointing out that, section 269-15(3) of the TAA provides as follows:
“The Commissioner must not commence, or take a procedural step as a party to, proceedings to enforce an obligation, or to recover a penalty, of a director under this Division if an *arrangement that covers the company’s obligation is in force under section 255‑15 (Commissioner’s power to permit payments by instalments).
Note 1: The arrangement may also cover other obligations of the company.
Note 2: Subsection (3) does not prevent the Commissioner from giving a director a notice about a penalty under section 269‑25.”
As compared with the previous legislation, where entering into a payment arrangement remitted the penalty, under the current legislation the Commissioner merely can’t recover a penalty from a director whilst the arrangement is on foot, the penalty itself is not remitted.
