On 5th of February 2020 both houses of parliament passed the Treasury Laws Amendment (Combating Illegal Phoenixing) Bill 2019. This legislation was to target and address illegal phoenixing activities. Please click here if you would like to learn about what is a phoenix company. Below is a summary of the changes introduced with the new legislation:
- In targeting those who conduct or facilitate illegal phoenixing, enforcement options were strengthened through the introduction of new phoenix offences and civil penalties to carry the highest penalties available under the law. There are also new powers for ASIC with recovery provisions also available to liquidators to improve their ability to recover assets that were lost though illegal phoenixing.
Accountability of directors:
- To prevent directors from avoiding responsibility by improperly backdating resignations or leaving the company without a director, resignation is to be lodged with ASIC within 28 days of it occurring.
New tax and GST liabilities:
- Directors will be personally liable to meet the company’s GST liabilities under certain circumstances, extending the previous obligations of meeting the company’s superannuation guarantee and PAYG obligations. This new provision relating to GST liabilities and director penalties will come into effect on April 1st 2020. As a result of this change it is critical that all company directors make sure that the business activity statements BAS are lodged on time.
If you would like to know how the new laws may affect your company or if your company is insolvent or likely to become insolvent, then act immediately by seeking the help from professionals. Australian Company Liquidations can assist you in shutting down your failed business the right way. Call us on 1800 981 070 for a FREE initial consultation now.