If you are a company director, this one is about your personal finances, not just the company's. The Tax Ombudsman has opened a formal review into how the ATO administers director penalty notices, known as DPNs, and is asking directors, former directors and advisers to share their experiences.

A quick refresher on DPNs

A director penalty notice is the tool the ATO uses to make company directors personally liable for certain unpaid company tax debts. It matters most for amounts the company holds on behalf of others, such as PAYG withholding, GST and super guarantee. Once a notice is issued, the window to act is short, commonly described as 21 days. If returns and activity statements were not lodged on time in the first place, the options narrow further.

Why the review is happening

The numbers explain it. According to the Tax Ombudsman, the ATO issued more than 84,000 DPNs to around 64,000 companies in the 2025 financial year, a 136 per cent increase on the year before. Tax Ombudsman Ruth Owen, who flagged the review last year, has said DPNs "can have significant impacts on individuals" who are unaware of liabilities because of miscommunication or factors such as personal illness.

The review will look at whether the ATO:

  • gives current and former directors adequate and timely information about their obligations, the penalties and the actions available to them
  • properly considers a director's circumstances when issuing a notice and recovering the debt
  • responds consistently to vulnerability, including coerced directorships and financial abuse.

How to have your say

Submissions close at 5:00pm AEST on Tuesday 29 September 2026. There is a short online survey on the Tax Ombudsman's website, and webinars are scheduled for 10, 15 and 16 September. The final report is expected around April 2027.

What directors should do in the meantime

The review does not pause the DPN regime. Notices are still going out and the deadlines still apply. Sensible steps:

  • Lodge on time, even if you cannot pay. Lodging BAS, PAYG and super reporting on time keeps more options open if the company later strikes trouble.
  • Check your address with ASIC. Notices are sent to the address on the ASIC register. An old address does not stop the clock.
  • Never ignore a notice. Get professional help the day it arrives.
  • Know what you signed up for. If you are a director in name only for a family member or partner, you carry the same personal exposure.
  • Talk to the ATO early. A payment plan arranged before things escalate is far easier than dealing with a notice.

This article is general information only. If you have received a DPN, seek professional advice immediately.