The bill, which lapsed with the calling of the federal election earlier this year, has been reintroduced by the government and will be set for debate in the House of Representatives this week.
There are four measures in the bill, including new offences to prohibit creditor-defeating dispositions; to prevent directors from improperly backdating resignations or ceasing to be a director when this would leave the company with no directors; to extend the estimates and director penalty regimes to GST liabilities, including the Luxury Car Tax (LCT) and the Wine Equalisation Tax (WET); and to authorise the commissioner to retain tax refunds where a taxpayer has failed to lodge a return or provide other information.
The Senate Standing Committee on Economics had previously recommended that the bill be passed, despite submissions from key industry bodies pointing out existing provisions and the need to enforce them.
Should the changes pass, directors will be held liable for GST, LCT and WET liabilities, on top of the current estimates and director penalty regimes for PAYG withholding and superannuation guarantee liabilities.
Further, directors will also not be allowed to resign from a company if doing so would leave the company without a director.
If the resignation of a director is reported to ASIC more than 28 days after the purported resignation, the resignation takes effect from the day it is reported to ASIC.
The changes aim to curb illegal phoenix behaviour by preventing directors from improperly backdating resignations and from shifting accountability to a “straw director” who has no real involvement in the company.
Jotham Lian is the news editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
With a focus on breaking news and exclusive analysis, Jotham keeps Accountants Daily readers up to date with company moves, tax updates and essential business and client strategy.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.