(a) a notice is given to a person under subsection 1229(1) in relation to a debt; and
(b) an amount (the unpaid amount ) of the debt remains unpaid at the end of the day (the due day ) on which the debt is due to be paid; and
(c) at the end of the due day, there is no arrangement in effect under section 1234 in relation to the debt;
then the person is liable to pay, by way of penalty, interest charge, worked out under subsection (3), for each day in the period described in subsection (2).
Note: For exemptions, see sections 1229E and 1229F.
(2) The period starts at the beginning of the day after the due day and ends at the end of the earlier of the following days:
(a) the last day at the end of which any of the following remains unpaid:
(i) the unpaid amount;
(ii) interest charge on any of the unpaid amount;
(b) the day before the first day, after the due day, on which the person makes a payment under an arrangement under section 1234 in relation to the debt.
(3) The interest charge for a day in the period described in subsection (2) is worked out by multiplying the interest charge rate for that day by the sum of so much of the following amounts as remains unpaid:
(a) the unpaid amount;
(b) the interest charge from previous days.
Note 1: For interest charge rate see section 1229D.
Note 2: The interest charge for a day is due and payable to the Commonwealth at the end of that day and is a debt due to the Commonwealth: see section 1229C.