ATO departure prohibition orders: when tax debt stops you leaving Australia

What is a departure prohibition order?

Among the ATO’s enforcement tools, a DPO is one of the firmest. It does what the name suggests: someone with a tax debt is barred from leaving Australia. It stays on foot until the debt is cleared or the ATO is satisfied with an arrangement to deal with it.

DPOs are far less common than garnishee notices or director penalty notices, and they apply to individuals rather than companies. But for business owners with family overseas, international suppliers or customers, or plans to work abroad, they can be devastating — which is why this low-volume topic deserves a clear explanation.

When does the ATO use one?

The ATO may issue a DPO when a person has an outstanding tax liability and the ATO believes the order is necessary to make sure the debt is dealt with before they leave Australia. It considers individual circumstances before deciding. The ATO’s practice statement on enforcement measures sets out the factors in more detail; broadly, it’s concerned with situations where a person might leave without the debt being paid or arranged.

A tax debt can be personal for business owners in several ways:

• a sole trader’s business tax is their own tax;
• a director can become personally liable for company GST, PAYG withholding and super through the director penalty regime;
• individual income tax on business profits, distributions or wages.

How long does a DPO last?

Until one of these happens:

Outcome	How
Debt paid	Pay the full tax debt — the ATO says this is the quickest route to revocation
Satisfactory arrangement	Contact the ATO to agree a payment plan it accepts
Revoked	Apply to the ATO with grounds and supporting documents
Set aside	Seek external review, or apply to a court

Breaching a DPO — leaving Australia while it’s in force without authorisation — is an offence that the ATO says may result in serious consequences, including penalties or imprisonment.

What is a departure authorisation certificate?

A departure authorisation certificate (DAC) allows temporary overseas travel while a DPO stays in force. The ATO grants DACs only in limited circumstances, and they may include conditions — for example, providing security to make sure you return or the debt is dealt with. There’s an application form on the ATO website setting out what’s needed and how applications are assessed.

If you have urgent travel — a family emergency, a critical business trip — talk to the ATO and a lawyer quickly. Applications take time to assess.

How can funding help?

Because a DPO lasts until the debt is paid or arranged, paying the debt is the most direct way to end it. For a business owner with property, a property-secured loan can clear a personal tax debt or a director penalty liability that relates to business activities; funding is possible in as little as 24 hours once the lender has what it needs. Where arranged, the payment goes straight to the ATO, and you can then ask the ATO to revoke the order.

Two notes of care:

• Our loans are for business purposes only. Clearing a director penalty liability or business-related tax generally qualifies; purely personal tax may not. We’ll talk it through with you.
• If the debt is large relative to your assets and income, a lawyer or the free National Debt Helpline (1800 007 007) can help you understand your wider position first.

An illustrative example

A company director whose parents live overseas had become personally liable for the company’s unpaid PAYG withholding through a director penalty notice that wasn’t dealt with in time. A DPO followed. With the company trading again, the director used a second mortgage over an investment property to pay the director penalty in full. The ATO revoked the order once the payment was applied, and the director was able to travel for a family occasion months later.

What should you do now?

1. Read the DPO and any covering letter carefully.
2. Get your ATO statement showing the debt the order relates to.
3. Speak to a lawyer about your rights to review.
4. Contact the ATO about payment or an arrangement.
5. Line up funding if payment is the realistic path.

How does a DPO relate to other ATO action?

Departure prohibition orders are usually one part of a broader collection effort, not a standalone event. A person subject to a DPO may also have a garnishee notice on a bank account, a credit-reporting disclosure for a related business, or director penalties. Dealing with the underlying debt resolves all of them together, which is why payment — or a satisfactory arrangement — is the focus.

Planning travel around a tax debt

If you have travel planned and an ATO debt you’re working through, deal with the debt before you book rather than after. Paying it in full, or putting a satisfactory arrangement in place, avoids the risk of a DPO altogether. If you’re a director, also check whether any director penalty notices have been issued, because they can make a company debt personal — and personal debts are what DPOs relate to.

Want the order ended as quickly as possible?

If a departure prohibition order is in place because of a business-related tax debt, see if you qualify. There’s no credit check to enquire, your details stay with us rather than being forwarded to multiple lenders, and a real person will talk through whether funding can clear the debt. Accurate details about the debt and any travel deadlines help us respond appropriately.