Enforcement of Debt and Director Penalty Notices: Proactive Management is Key

Apr 29, 2024

ATO Enforcing debt and Director Penalty Notices


As the ATO takes an increasingly stringent stance on debt, accountants and tax agents will need to be more proactive than ever.

With the ATO strongly enforcing tax debt there will be a rise in the number of credit referrals and Director Penalty Notices being sent out. Keeping abreast of all correspondence from the ATO is crucial in ensuring you and your clients are well-prepared to manage any challenges.


Why the Urgency?

The ATO’s rigorous approach to debt recovery and the issuance of Director Penalty Notices (DPN) is to ensure businesses and directors remain compliant. The ATO is taking firm action against those not complying, and failing to meet these obligations will have significant repercussions. At the last Tax Institute Summit the ATO Commissioner Chris Jordan was “unapologetic” about the ATO’s tougher stance on collectable debt and asked for tax professionals to help.*


Client Obligations – Keeping Clients Informed and Compliant

The importance of clear communication with clients about their obligations is paramount. It’s not just about reminding them of their obligations but also equipping them with the right tools and information to manage their finances better. This includes:


Understanding Digital Instalment Notices: These digital instalment notices aren’t available to clients via myGov or any other platform, these are only available to tax agents and accountants. Are you passing these documents on effectively to your clients?


Potential Risks: If you are not managing ATO correspondence effectively and efficiently (including digital instalment notices) then clients may miss out on important notifications, and this may lead to them not paying the ATO on time.


Navigating myGov

When your clients have a myGov account it means you, the accountant, no longer receive their ATO documents and will be out of the loop. The challenge is clients may not be regularly accessing their myGov account, therefore they only contact you to help them when debt is being chased.


Proactive Management and Communication

You need to stay ahead of the game and lean towards a proactive approach. If you’re proactively communicating all ATO correspondence to your client there’s less risk of clients missing out on receiving important ATO documents. Bills are paid on time, and you’re paid on time.


ATOmate for effective ATO Document Communication

ATOmate is changing the way accountants handle ATO correspondence and client communication.

ATOmate is designed to:

  • Bridge the communication gap, ensuring ATO correspondence is captured, processed, and actioned in one place.
  • Never miss PAYG instalment notices.
  • Simplify client communication with templates to keep clients informed, hearing from you first.
  • Maintain control over ATO-related communications, offering clients a streamlined, transparent, and efficient experience, reinforcing trust and reliability.

The benefit of taking a proactive approach by keeping your clients informed and sending them their ATO documents is that your clients are aware of their obligations and pay on time. Therefore they should not receive debt or penalty notices.


Take Action

Get on top of ATO documents in your accounting practice. Discover the full potential of what ATOmate can bring to your firm. Book an ATOmate discovery call today and navigate the world of ATO communications with confidence and ease.


*Accountants Daily 06/09/2023/- Rolling the dice on tax debt

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