# Debt from failure to comply with garnishee notice

> act-s265 — as in force on 2026-06-04 — C2026C00232 · Compilation No. 171 — https://www.legislation.gov.au/C2026C00232/latest/text

265 Debt from failure to comply with garnishee notice
          (1) If a person (garnishee debtor):
                (a) is given a notice under section 264 in respect of a debt; and
                (b) fails to comply with the notice to the extent that the garnishee
                    debtor is capable of complying with it;
              then the amount of the debt outstanding is recoverable from the
              garnishee debtor by the Commonwealth by:
                (c) legal proceedings in a court of competent jurisdiction; or
                (d) a garnishee notice under section 264.
          (2) The reference in subsection (1) to the amount of the debt
              outstanding is a reference to whichever is the lesser of:
               (a) as much of the amount required by the notice under
                    section 264 to be paid by the garnishee debtor as the
                    garnishee debtor was able to pay; or
               (b) as much of the debt due at the time when the notice was
                    given as remains due from time to time.
          (3) If the Commonwealth recovers:
                (a) the whole or a part of the debt due by the garnishee debtor; or
                (b) the whole or a part of the debt due by the debtor (within the
                     meaning of section 264);
              then:
                (c) both debts are reduced by the amount that the
                     Commonwealth has so recovered; and
                (d) the amount specified in the notice under section 264 is taken
                     to be reduced by the amount so recovered.