ATO Uses New Powers to Recover $8 Million in Super

The Australian Taxation Office has used new powers to recover $8 million in unpaid superannuation from companies in South Australia and Victoria.

The ATO has sprung on the operators of labour-hire companies who had engaged in what the tax office describes as ‘phoenix behaviour’.

The network of companies provided services such as seasonal fruit picking and meat packing and had been failing to pay workers their superannuation entitlements.

According to the ATO, Phoenix behaviour involves the deliberate liquidation of companies to avoid paying superannuation obligations as well as to avoid other tax liabilities and to avoid paying creditors and suppliers.

The ATO’s Deputy Commissioner, Michael Cranston, said new powers, known as Superannuation Guarantee Estimates (SGE), allowed the ATO to step in where it saw likely phoenix activity and protect workers’ super entitlements before companies try to liquidate and avoid their responsibilities.

“The ATO can also issue director penalty notices which make directors personally liable for the company’s unpaid superannuation obligations,” Cranston said.

“Phoenix operators cheat their workers and undercut honest business. Tackling the behaviour is key focus for the ATO.

“We expect to use these powers more frequently against phoenix operators.”

The SGE powers allow the ATO to raise liabilities against companies who fail to disclose details about their employees.

They also allow the ATO to deal with Phoenix behaviour in real-time, by making a reasonable estimate of a company’s superannuation obligations, and raising a debt on the company or its directors before the company can be put into liquidation.

Workers who suspect their employers are not paying their superannuation entitlements should visit www.ato.gov.au/unpaidsuper

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