Why this matters

The ATO has materially tightened recovery. In FY2023–24 it issued 26,702 DPNs (up ~50% on the prior year), and by 31 March 2025 had already issued 59,320 for the year to date. Enforcement is back on in earnest.

DPN types (in plain English)

• “Non-lockdown” DPN (liability reported on time):
  • Directors have 21 days to pay, appoint a VA, or appoint a liquidator and
  • Directors can obtain remission by acting within the 21 day notice period. (ATO DPN’s)
• “Lockdown” DPN (liability not reported by the due date):
  • No remission via SBR, VA or liquidation;
  • Payment (or a valid defence) is required.

Immediate steps if a DPN arrives

1. Triage the debt: Break down PAYG/GST/SGC components; confirm lodgement status to see if any portion is a “lockdown” DPN. (ATO DPN’s)
2. Check the clock: 21 days (non-lockdown DPN) runs from the date the ATO posts the notice to the ASIC-registered address—update your details.
3. Stabilise cash flow: Build a simple 13-week cash flow to test options (pay/VA/SBR).
4. Document director steps: Minutes showing active monitoring assist safe harbour assessment.
5. Engage early: Contact your local Rodgers Reidy office to assess your options

Safe harbour & when to restructure

• Safe harbour may protect directors while a genuine turnaround plan is developed and implemented; it requires timely lodgements, employee entitlements up to date and proper records.
• SBR: If viable and under the SBR thresholds, SBR allows directors to remain in control while a compromise is offered to creditors. (Rodgers Reidy (SBR))
• VA/DOCA: Consider where liabilities exceed SBR limits, or other critical components require Administrator appointment and greater urgency.

Key signals SBR may fit

• Core business profitable pre-debt; customers/suppliers intact.
• Existing Tax debt, with lodgements broadly up to date;
• Some employee entitlements payable (including Superannuation);
• Creditors open to a commercial compromise.

Call Rodgers Reidy

Talk to our Small Business Restructuring specialists or your local Rodgers Reidy office to triage a DPN quickly and decide whether an SBR is the correct option for your business. (Rodgers Reidy (SBR))