Unpaid and unreported Superannuation Debt means danger for Company Directors

The ATO’s power to pursue unpaid superannuation underwent significant changes in June 2012.

The ATO was given new powers to:

Expand the Directors Personal Liability regime from just PAYG deductions to include Superannuation Guarantee amounts.

Make directors automatically personally liable if PAYG or Super Guarantee amounts remain unpaid and unreported three months after the due date for lodging a return and a director cannot cause their director penalties to be remitted by placing their company in administration or liquidation – the new term used is a “Lockdown DPN”.

From October 2013 the ATO will start sending warning letters to directors of companies with superannuation guarantee debts. Be aware that if a company cannot meet its superannuation obligations, the ATO requires the company to submit a Superannuation Guarantee Charge Statement. If the company is more than three months late in submitting to the ATO, the directors can be held personally liable for the unpaid amount.

What do you do if you receive a Super Warning Letter or DPN?

* If the company can pay its debts then it should do so in order to avoid personal liability for the Director.

* If a DPN is received with a 21 day Notice period (old law), then react and pay within 21 days.

* Directors should get their company Tax Returns, including Superannuation Guarantee Charge Statement, up to date and lodged. If a company can’t pay the PAYG or Superannuation liability, it should lodge the returns anyway or a director risks incurring a Lockdown DPN and therefore automatic personal liability.

* If PAYG debts and returns are already 3 months late either pay the debt or get the company in liquidation. If reporting is out of date, a liquidation won’t guarantee the director won’t hear from the tax office, but it is the best chance to move the company and the director personally, to the bottom of the Enforcement Action pile.

NB: Superannuation Debt also includes Directors personal Superannuation payable if the Director is paid wages.


From 1st July 2014 the new employer compulsory superannuation guarantee rate is 9.5%.


A data and payment standard is being introduced to make processing super payments easier for you. The new standard means you will be able to send super contributions to funds in one standard electronic format. This removes the need to submit information to separate funds in different formats.

If you have 20 or more employees you need to start using the new standard for sending contributions to funds from 1st July 2014.

If you have less than 20 employees you may need to start using the new standard for sending contributions to funds from 1st July 2015. (This proposed change is still to be confirmed).

You can work with your default super fund or payroll manager to meet the standard. You can also get help from CDP & Co or use the Small Business Superannuation Clearing House.

Please feel free to call CDP & Co to discuss any of your Payroll, Superannuation & PAYG obligations.