A practical guide for directors who have received a Director Penalty Notice. You have options. We can help.
Free, no-obligation, 30-minute diagnostic call. No invoice. No follow-up unless you want it.
If you are reading this, you are probably frightened. You may not have slept properly in days. You may be wondering whether you are about to lose everything you have worked for.
This is serious. But it is not the end. There are options. And you are not alone.
The team at Rebound Advisory has worked in restructuring and turnaround advisory on both sides of the table. We have dealt with hundreds of Director Penalty Notice situations. We know exactly where you are right now, and we know the way through.
The directors who come through this best are not the ones with the most money or the best lawyers. They are the ones who acted quickly, understood their position clearly, and got the right people around them before the deadline passed.
A Director Penalty Notice can make you personally liable for your company's unpaid PAYG withholding, GST or super guarantee charge. Your options depend on the notice and on when each relevant amount was reported.
Reported within the relevant period
You may have a standard DPN (often called non-lockdown). The tax office lists remission options within the 21-day period.
Reported late or not reported
You may have a lockdown DPN. For those amounts, payment in full is the tax office's stated remission path.
Your DPN letter will tell you which type you have. If you are not sure, call us and we will help you work it out.
The tax office states that the 21-day period begins when the DPN is posted or left at your ASIC-registered address. Do not assume the printed date or the day you first saw the letter is the operative date.
Contact the tax office or obtain advice now to confirm the operative date, each liability and the available statutory options. Do not wait for a payment-plan discussion to do this.
These are the four most common and costly mistakes directors make when they receive a DPN.
Answer two questions to understand your situation and your options.
Answer two questions to understand what type of DPN you have and what your options are.
Were the relevant PAYG and GST amounts reported within three months of their due date, and SGC reported by its due date?
The reporting timing is critical. A notice can cover liabilities with different remission rules.
This is what to do in the next 48 hours. The directors who act early almost always come through it. The ones who freeze rarely do.
Hour 1
Find the DPN letter. If it went to an old address, contact the tax office to request a copy.
Confirm when the notice was posted or left at the ASIC-registered address. Record the 21-day deadline immediately.
Work out whether it is non-lockdown, lockdown, or a combination.
Note the total amounts. Break them down by PAYG, SGC, and GST.
Hours 2-4
Use the tax office portal, or ask your accountant to check, and confirm the reporting status of all BAS, IAS and SGC statements.
If anything is overdue, lodge it promptly. Later lodgment does not change the remission rule for an already late period, but it can prevent further exposure.
Check the amounts in the DPN against your own records. Errors and misallocations are not uncommon.
Hours 4-8
Build a quick snapshot: bank balances, outstanding debtors, upcoming payments, available credit.
Can the company pay the DPN debt in full within 21 days? If yes, arrange payment.
If payment in full is not realistic, obtain advice on the statutory options before a repayment arrangement is discussed.
Is the ATO debt the only pressure, or is it a symptom of broader financial distress?
Hours 8-24
Talk to an appropriately qualified legal, tax or restructuring professional who has dealt with DPNs before.
The notice, reporting dates and company position need to be assessed together. Do not rely on generic online guidance alone.
Hours 24-48
Choose your path. Begin implementation immediately. Every day that passes is a day you cannot get back.
Document everything. Keep a record of every step you take, every conversation, every decision.
"The directors who act early almost always come through it. The ones who freeze rarely do."
These are real scenarios, with names and details changed. They show how differently things can turn out depending on the decisions made in those first few days.
Steve - Civil Construction
$2.4 million DPN
Steve was the sole director of a civil works contractor with 85 employees across three state government infrastructure projects. A disputed variation claim left a $3 million hole in cash flow. PAYG and GST fell behind. When the DPN arrived for $2.4 million, Steve assumed he was finished. But his accountant had kept all BAS lodgements current, making the DPN non-lockdown. Steve called us on day two. We helped him appoint a voluntary administrator within 14 days. The administrator negotiated a Deed of Company Arrangement that reduced unsecured debts by 55%.
Outcome: Steve's personal liability was entirely remitted. The business continued trading, 85 jobs were preserved, and Steve kept his house and his family's financial security.
Karen - Transport and Logistics
$1.8 million DPN
Karen and her husband ran a freight business with 40 trucks and $28 million in revenue. When fuel costs spiked and two major customers left, they fell behind on PAYG and super across four quarters. Karen received a non-lockdown DPN for $1.8 million but assumed a payment plan would protect her. She spent the entire 21-day window negotiating. The ATO agreed to a plan. But because no formal appointment was made, Karen's personal liability crystallised.
Outcome: Karen and her husband were both declared bankrupt. They lost their family home. The lesson: a payment plan does not remit a DPN.
Anthony - Manufacturing
$3.1 million DPN
Anthony was the managing director of a food manufacturer employing 120 people. After losing a major supermarket contract, the finance manager stopped lodging BAS and SGC statements without telling Anthony. By the time the DPN arrived for $3.1 million, lodgements were 14 months overdue. The entire DPN was lockdown. Voluntary administration would have no effect.
Outcome: Anthony refinanced the family home to raise $1.9 million and negotiated a personal payment arrangement for the remaining $1.2 million over five years. The process consumed eighteen months and placed enormous strain on his family. The lesson: lodge on time, every time.
David - Consumer Retail
$1.2 million DPN (new director)
David joined the board of a retailer with 14 stores without checking ATO compliance. Within six weeks he discovered three quarters of unlodged BAS and $1.2 million owing. His 30-day grace period had already expired.
Outcome: Statutory defences were available, but establishing them required months of legal argument, significant fees, and stress that affected his health and family. Even when the law is on your side, fighting a DPN is gruelling. The lesson: the cost of due diligence is trivial compared to what follows if you skip it.
84,000+
DPNs issued in FY2025
A 136% increase on the prior year
$36B
ATO collectable debt from small business
The ATO is actively recovering
10.65%
GIC interest rate (Jan-Mar 2026)
Compounding daily. No longer tax deductible from 1 July 2025
1 in 3
Businesses with >$100k debt, >90 days overdue
Failed within 12 months
This section is here for when you want the complete picture. You do not need to read it before calling us.
This guide is general information, not legal or tax advice. DPN outcomes depend on the notice, reporting history and circumstances. Confirm the current position with appropriately qualified advice and review the primary guidance below.
Brendan Richards
Founder & Senior Advisor, Rebound Advisory
Brendan has spent over 25 years in corporate restructuring and turnaround advisory, including senior roles at PwC, KPMG, and Ferrier Hodgson. He has advised directors across construction, manufacturing, retail, agribusiness, and professional services on navigating financial distress - including responding to Director Penalty Notices, engaging with the tax office, and implementing restructuring plans.
He founded Rebound Advisory to bring that level of expertise to privately owned businesses - the ones who need it most but have historically had the least access to it.
Claire Gaffney
Senior Advisor, Rebound Advisory
Claire brings experience from KPMG, Pitcher Partners, and ANZ, with particular expertise in agribusiness restructuring, stakeholder management, and working with lenders and creditors through complex informal workouts. She has supported directors through tax-office negotiations and DPN responses across multiple sectors.
Download the PDF guide
The complete DPN guide in a single PDF. Share it with your accountant, your lawyer, or anyone else who needs to understand the situation quickly.
© 2026 Rebound Advisory. General information only - not legal, tax, or financial advice.
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Free, no-obligation, 30-minute diagnostic call. We will assess your situation, tell you where you stand, and lay out your options. No invoice. No follow-up unless you want it.
This guide was produced by Rebound Advisory. It is intended as general information only and does not constitute legal, tax, or financial advice. Every situation is different. If you have received a Director Penalty Notice, seek specialist advice specific to your circumstances before taking any action. © 2026 Rebound Advisory. All rights reserved.