The Australian Taxation Office (ATO) may issue a Garnishee Order if you fail to meet your tax debt payment obligations. However, you must be left with reasonable living expenses. What are reasonable living expenses will be determined by the type of garnishee that has been issued.
There are two types of garnishee orders. One is issued to a taxpayer’s employer for salaries and wages. The other garnishee order is issued to a bank and requires the bank to forward all funds in the account to the debtor, in this instance the ATO.
All states have a statutory minimum of the amount that must be left available to the taxpayer where a garnishee for salaries and wages has been issued. For instance, in New South Wales (NSW), the debtor must leave a net weekly amount of $474.20.
The situation is a little different where the garnishee order has been issued to a bank. There is no statutory minimum that the debtor must leave. However, the ATO is willing to consider submissions as to a taxpayer’s reasonable cost of living.
In this instance, the ATO will have regard to:
If you receive a Garnishee Notice and want the ATO to review it, contact the team at Waterhouse Lawyers. We can help.