Karina Barrymore
NEW laws making company directors personally liable for unpaid superannuation and staff taxes have started a record surge in liquidation inquiries.
The legislation, designed to protect super contribution, empowers the Australian Tax Office to make directors personally liable for PAYG and super contributions if they are unpaid for longer than three months.
However, the safety net for employees has caused a run of companies to consider liquidation, just days after the law came into force.
The law came in to effect on June 29.
“As a result we have been swamped with inquiries and requests for liquidation services as soon as possible so directors can avoid personal liability,” insolvency specialists SV Partners chief executive Tim Heesh said yesterday.
He added: “The new laws have changed the landscape overnight and directors now have to be very vigilant about reporting their liability position.”
The superannuation industry has welcomed the move.
“New laws to get tough on employers who don’t meet their super obligations are obviously long overdue,” Australian Institute of Superannuation Trustees chief executive Fiona Reynolds said.