Exasperated business owners have revealed their frustrations with the Australian Securities and Investment Commission over its handling of late fees for annual review invoices.
Business owners told SmartCompany on Wednesday that the fees were “exorbitant” and “a rort”. Some have also claimed that they have been hit with late fees even though they have paid the amount owed as soon as they received the invoice from their accountants.
The comments were made in response to a SmartCompany article about a business owner who has been fighting ASIC’s late fees on his annual review invoice for over 12 months, and who is appealing to the Commission for leniency given his consistent track record in paying the invoice.
Business owner Dennis Rutzou had paid his annual invoice on time for almost 50 years, but a letter lost in the mail landed him with a late payment fee.
Appealing to ASIC for clemency, Rutzou’s request was denied, and he now owes a total of $637 to ASIC, which is comprised of cumulative late fees and an another annual review payment.
“It’s curious the banks get slammed over their exorbitant late fees and how they can’t be justified, but the government through ASIC will charge you $76 for being one day late paying a $249 annual fee and then if you are 31 days late they will charge you a further $276 dollars. Go figure!” wrote one individual on Facebook.
Another comment writer labelled the fees one of the “most frustrating elements” of dealing with government bodies, saying “not even the banks” could get away with the “outrageous fees”.
“Huge” fines an issue
Rutzou’s fees included an initial $75 late fee incurred two days after the deadline of his annual invoice payment. One month later, another $75 fee was incurred, and the following month he was charged a $237 fee.
On ASIC’s website, the Commission states the charges for late payments of annual company review fees is $76 for a late payment of up to one month, and $316 for more than one month. In a statement to SmartCompany, an ASIC spokesperson specified the late fees “are determined by the Commonwealth Parliament, and always have been”.
Many commenters have slammed ASIC’s fee structure, with one commenter asking how the Commission can justify the “high rate” of the fees.
“As a percentage the fines are huge. They complain about banks and others ripping of [sic] consumers yet they do the same. Highly hypocritical,” wrote one SmartCompany reader yesterday.
The initial late fee is $75, which equates to approximately 30% of a $249 annual company review invoice.
Business owners say delayed invoices common
Other commenters sympathised with Rutzou’s situation, claiming they experienced similar issues with late fees on delayed invoices.
“My accountant sold his business to another and the registered address wasn’t changed by him. I had few entities but it was one that didn’t get changed,” one SmartCompany reader said.
“I paid [the] invoice immediately when it finally got to me. Complained to gov [sic] but none of what I explained was on their list of exceptions.”
Another individual noted their invoice did not arrive on time for three years in a row, but still incurred late fees.
“This happened to me 3 years in a row, where I only received the second invoice, which included the late fees. The original invoices never arrived,” they said.
This individual said they spoke to an ASIC representative and claims they were told it “wasn’t their problem” and that the invoices had been sent.
ASIC notes “reasonable community expectation” for fees to be paid
In a statement to SmartCompany, an ASIC spokesperson said the date for annual review payment to be made is “set in advance”.
“It will occur at exactly the same time every year, and can be scheduled years in advance,” said the spokesperson.
“As it is, the recipient has two full months after the Review in which to pay the fee. That too is set, and can be scheduled years in advance.”
Some business owners claim to have experienced problems with ASIC issuing late fees despite payments being made on the date of renewal, due to differences in payment transferring times from banks.
“My business was fined when we paid by credit card ON TIME (just) but the transfer of funds to ASIC happened after the deadline,” one comment writer told SmartCompany yesterday.
“Most payees accept or agree that payment occurs at the time the credit card payment was made – NOT ASIC!!!”
However, ASIC maintains it does allow a “period of grace”, with a spokesperson stating, “if a payment comes through as the late-fee notification is being processed, for example, that late-fee is cancelled.”
“It is difficult to imagine what else ASIC should do given the reasonable community expectation that the fee be paid,” the spokesperson said.