You joined the board last month. Check the tax position today.

Your 30-day window started the day you were appointed

Before you become a director of an existing company, check if the company has any unpaid or unreported PAYG withholding, GST or superannuation guarantee charge liabilities. You may be personally liable for unpaid amounts that were due prior to your appointment. This is not a future threat or a formality you can address later. The liability attaches automatically if the company has missed tax or super payments before your appointment date.

As a new director, you will not be liable for a director penalty that was due before your appointment if, within 30 days of your appointment, you ensure the company pays the amount outstanding in full, appoints an administrator or small business restructuring practitioner, or winds up the company. The 30-day period is measured from the date of your appointment recorded with ASIC, not the date you started working or the date you discovered the problem. If you do nothing within that window, the debt becomes your personal liability.

What unpaid and unreported mean in practice

You may become personally liable for your company's unpaid amounts of pay as you go withholding, goods and services tax, and super guarantee charge. Unpaid means the company owes the ATO money for tax or super that was due. Unreported means the company has not lodged the return or statement telling the ATO what it owes, even if no payment has been made.

If the company fails to report PAYG withholding, GST or superannuation guarantee charge obligations by the due date, the ATO may make a reasonable estimate of the unpaid and overdue amounts. Director penalties can apply to these estimated liabilities. You can be held personally liable for a debt the company never formally reported. This is why your first task as a new director is to obtain the company's complete lodgement and payment history from the ATO or the registered tax agent, covering at least the past two years.

Source: Official guidance

Resigning within 30 days does not remove the liability

If you resign as a company director within the 30-day period, you may still be liable for the company's unpaid PAYG withholding, GST or superannuation guarantee charge liabilities that were due before your appointment. Walking away does not protect you. The only way to avoid personal liability for pre-appointment debts is to take one of the actions listed in the remission rules within the 30-day window.

If you joined a construction company as a director without conducting financial due diligence and you now discover unpaid tax or super, resigning immediately will not solve the problem. You must either arrange for the company to pay the debt in full, initiate formal insolvency proceedings, or accept that the debt will become your personal responsibility once the 30 days expire. This is a narrow window, and inaction is the riskiest choice.

Lockdown penalties and the three-month reporting rule

If the unpaid amount of PAYG withholding or GST is reported within 3 months of the due date, or in the case of new directors within 3 months of the date of their appointment, the penalty can be remitted within 21 days of the date the notice is issued if the company pays the amount outstanding in full, an administrator is appointed, a small business restructuring practitioner is appointed, or the company begins to be wound up. But if liabilities remain unreported after three months, appointing an administrator will not remove your penalty.

If the superannuation guarantee charge amounts are reported after the SGC due date or are never reported, the only way to remit the director penalty is to pay the company liability in full. Estimated amounts of SGC are treated as amounts that were never reported. If you are appointed as a director and the company has unreported super from earlier quarters, you inherit a lockdown liability unless the debt is paid in full within your 30-day window.

What to do in the first week after appointment

Request the company's full ATO lodgement and payment history for PAYG withholding, GST and superannuation guarantee charge for the past two years. Ask the registered tax agent or company accountant to confirm in writing which returns or statements have been lodged late, which remain outstanding, and what amounts are unpaid. Obtain copies of any ATO correspondence, payment plans or estimates issued in the past 12 months. This record tells you whether pre-appointment liabilities exist and whether they were reported on time.

If unpaid or unreported liabilities exist, calculate how many days remain in your 30-day window and identify which of the four remission options is realistic: full payment, appointment of an administrator, appointment of a small business restructuring practitioner, or winding up the company. Do not assume the other directors will handle it or that the ATO will not pursue you. CRP coordinates independent qualified insolvency and tax professionals who can assess your position, clarify the applicable remission rules, and help you act within the 30-day window. Call CRP today for turnaround support tailored to your circumstances.