Welcome To Workpaper.
Welcome To Workpaper.
Receiving a Director Penalty Notice (DPN) from the Australian Taxation Office (ATO) for unpaid superannuation is a serious and urgent matter. It means your company’s limited liability protection no longer shields you—you can be held personally responsible for unpaid superannuation debts.
This includes risking your personal assets, such as your home, savings, and investments.
In this guide, we explain what a DPN is, how it works, and what you must do immediately to protect yourself.
A Director Penalty Notice is issued by the ATO to make company directors personally liable for unpaid Superannuation Guarantee Charge (SGC).
👉 This means you are liable for the full amount, not just unpaid super.
The ATO takes unpaid super very seriously because it represents employees’ retirement savings.
👉 Key reasons for DPNs:
Recent enforcement trends show the ATO is increasingly strict, making it critical for directors to stay compliant.
Understanding the type of DPN you receive is crucial—it determines your options.
1. Non-Lockdown DPN (More Flexible)
Issued when:
Your Options (Within 21 Days):
✔ Pay the debt in full
✔ Appoint a voluntary administrator
✔ Place the company into liquidation
👉 Taking action within 21 days can remove your personal liability.
2. Lockdown DPN (High Risk)
Issued when:
SGC statements are not lodged within 3 months
Your Only Option:
❌ Pay the debt in full
👉 Even liquidation or administration will NOT remove your liability.
The Critical 21-Day Deadline
Once a DPN is issued:
The ATO can:
👉 Immediate action is essential.
Many directors believe liability starts when the notice arrives—this is incorrect.
👉 Liability begins when:
The DPN simply enforces that liability.
New vs Former Directors – What You Must Know
Former Directors
New Directors
Step 1: Verify the Notice
Step 2: Identify the Type
Step 3: Mark the Deadline
Step 4: Gather Documents
Step 5: Seek Professional Advice
Step 6: Take Immediate Action
🚫 Ignoring ATO notices
🚫 Assuming resignation removes liability
🚫 Waiting until the last minute
🚫 Using super funds for cash flow
👉 These mistakes can lead to serious financial consequences.
Prevention is always better than cure.
Best Practices:
✔ Lodge SGC and BAS on time
✔ Maintain accurate payroll records
✔ Monitor cash flow regularly
✔ Set aside super payments
✔ Seek early professional advice
👉 Timely lodgement—even without payment—can prevent a lockdown DPN.
What is a DPN?
A notice making directors personally liable for unpaid company tax debts, including super.
Can directors be personally liable for super?
Yes. A DPN allows the ATO to recover unpaid super from personal assets.
What’s the difference between lockdown and non-lockdown DPN?
Non-lockdown allows options to avoid liability; lockdown requires full payment.
Can I resign to avoid a DPN?
No. You remain liable for debts during your time as a director.
Can new directors be liable for old debts?
Yes, after 30 days if no action is taken.
A Director Penalty Notice is not something you can afford to ignore. Acting quickly and getting the right advice can make the difference between protecting your personal assets or losing them.
At Workpaper, we help directors and businesses stay compliant, manage super obligations, and respond effectively to ATO notices.
🌐 Website: https://workpaper.com.au/
📍 Address: 7 Bridge St, Werribee, Victoria 3030, Australia
📞 Phone: 0485 825 915
📧 Email: info@workpaper.com.au
👉 Contact us today for expert guidance and immediate support.
Workpaper Solutions Pty Ltd
WORKPAPER Is A Valuable Service Provider With An Endeavor To Offer Cost-Effective High-End Quality Solutions.
