Lately, we’ve been having more conversations with clients about ATO letters, compliance activity, and a sense that the tax office feels a little less forgiving than it used to. If that’s your instinct, it’s spot on.
The ATO has significantly increased enforcement activity, and we’re now seeing faster escalation where lodgements or payments fall behind. We wanted to share a short update on what’s changing, why it matters, and how you can protect yourself.
What we’re seeing in practice
Directors at greater personal risk: The ATO is issuing more Director Penalty Notices (DPNs), which can make directors personally liable for unpaid PAYG, GST, and superannuation. This risk is serious, but largely preventable through timely lodgement.
Tax debts being actively chased: We’re seeing increased use of default assessments, external debt collection, and enforcement action, particularly where lodgements are outstanding.
Late lodgement penalties applied consistently: Failure to Lodge penalties are now being applied far more consistently. For small entities, penalties are $330 per 28 days overdue, up to $1,650 per lodgement, with higher penalties for larger entities.
Super compliance tightening: Even a one-day delay can trigger Superannuation Guarantee Charge obligations, which are expensive and not tax deductible. With Single Touch Payroll data matching and increased ATO visibility, late super is now much harder to hide.
Payday Super is coming
From 1 July 2026, employers will be required to pay Superannuation Guarantee (SG) at the same time as salary and wages are paid, rather than quarterly. This change – commonly referred to as “Payday Super” – means super will no longer be payable 28 days after the end of each quarter. Instead, it will need to be processed and paid with each pay run. Although this may feel like a while away, businesses that currently rely on holding super cash until the quarterly due date will notice the cash flow impact. Planning early will make this transition much smoother.
How to start aligning your cash flow now
A gradual transition during the 2026 financial year can significantly reduce pressure. For example:
- Early pay your January and February super by 14 March
- Pay March super 14 April
- Pay April super 14 June
- Move to fortnightly super payments for May and June
By 1 July 2026, your superannuation cash flow will be aligned with your payroll cycle.
By “weaning” onto more frequent super payments, you avoid the shock of moving from a quarterly lump sum to immediate payment with each pay run.
What we recommend doing now
- Start setting aside super with each pay run, even if you still pay quarterly
- Review your payroll software processes and capabilities
- Update your cash flow forecasts
- Consider moving to monthly super payments well before 1 July 2026
The earlier you begin adjusting, the easier this change will be. If you would like assistance modelling the impact on your business, updating payroll settings, or creating a transition plan, please get in touch.
The key message
Even if you can’t pay a tax bill immediately, lodging on time is critical as it:
- Reduces the risk of director personal liability
- Preserves eligibility for ATO payment plans
- Lowers the chance of immediate enforcement action
Failing to lodge significantly limits your options.
How we help
As your tax agent, we can:
- Access lodgement concessions and deferrals
- Negotiate structured payment arrangements
- Engage directly with the ATO to prevent escalation
These options are strongest when lodgements are up to date and issues are raised early.
You can help protect your position by:
- Providing information as early as possible
- Responding promptly to requests
- Lodging on time, even if payment needs to be managed
- Letting us know early if cash flow is tight
If you have concerns about lodgements, tax debts, or upcoming payments, please get in touch early so we can help.
