Last week saw the long-anticipated Treasury Laws Amendment (Combatting Illegal Phoenixing) Bill 2019 finally pass both Houses. The legislation contains numerous measures to combat illegal phoenixing.
The bill contains four (4) further measures to combat illegal phoenixing, which were briefly discussed in our February 2019 newsletter “Another legislative salvo aimed at illegal phoenixers goes before parliament”. We will shortly provide further detailed clarification of the legislative changes, however in short, the changes include:
1. The director penalty notice regime has been extended to include GST (and WET and LCT).
2. The commissioner of taxation now has the ability to retain tax refunds in the event of outstanding lodgements including BAS’s and Single Touch Payroll notifications.
3. The introduction of new legislation to target phoenixing and property transfers to defeat creditors, including an obligation to evidence pre liquidation disposals of assets at “market value”.
4. Tighter controls and measures surrounding the resignation of directors.
Now that the legislation has passed both houses, it awaits Royal Ascent which usually takes 7-10 working days. The legislation will take effect from the start of the first quarter after Royal Ascent. This means the new rules look set to start from 1 April 2020.
Shaw Gidley are experts in restructuring, turnaround and insolvency and provide free initial advice on these matters. Please contact our offices on (02) 4908 4444 or (02) 6580 0400.