Directors’ personally liable for superannuation guarantee paid late

The Federal Court in Ostwald v Commissioner of Taxation [2026] FCA 868 considered whether the directors were personally liable for director penalties in relation to superannuation guarantee charge payable by the company.   Of note is the fact that the company did actually make payments for the relevant superannuation guarantee, however the payments were paid late in respect of the quarters ended September 2016, 30 December 2016 and 31 March 2017. 

In fact, the payment for the quarter ended 30 September 2016 was made on the actual due date of 28 October 2016, but unfortunately the payment was only received by the superannuation fund three days later. Having not lodged a superannuation guarantee statement, the Commissioner issued a default assessment for superannuation guarantee charge to the company and subsequently also issued director penalty notices in respect of the abovementioned three quarters.  What the directors sought to argue is that they were not liable for director penalties under section 26935(2) of Schedule 1 to the TAA 1953 on the basis they took all ‘reasonable steps’ to ensure the company the Government introduced the complied with its obligations (i.e., being its obligation to pay superannuation guarantee charge).

First, the Federal Court didn’t consider this defence was available to the directors.  This was essentially for the reason that such a defence could only be available where there is a recovery of any of the penalty. Alternatively, the Federal Court concluded the directors couldn’t satisfy the ‘all reasonable steps’ defence.  The challenge was that the steps taken by directors didn’t appear to be directed at the superannuation guarantee charge liability, specifically.