A penalty unit is the fixed dollar amount Australian law uses to size a fine. One Commonwealth penalty unit is $330 for any offence committed on or after 7 November 2024. A fine is just that figure multiplied by the number of units the law attaches to the offence.
The number of units is written into the legislation. The dollar value sits separately, in the Crimes Act 1914. That split is deliberate. Parliament can lift the value of every Commonwealth fine at once by changing one number, without reopening hundreds of separate Acts.
One thing trips people up. The value that applies is the one in force on the day the offence was committed, not the day a court or regulator deals with it. So the relevant figure depends on when the conduct happened:
When the offence was committed | Value of 1 penalty unit |
Before 7 November 2024 | $313 |
On or after 7 November 2024 | $330 |
On or after 1 July 2026 | Indexed to CPI (not yet published) |
From 1 July 2026 the value reindexes automatically against the Consumer Price Index, then every 3 years after that. That mechanism sits in section 4AA(3) of the Crimes Act, added by the Crimes and Other Legislation Amendment (Omnibus No. 1) Act 2024. The exact figure for offences from 1 July 2026 had not been published at the time of writing. ASIC and the ATO list the current value, so check there for conduct on or after that date.
Why a Tranche 2 firm should care: AML/CTF penalties are written in penalty units, from failing to enrol through to gaps in your customer due diligence. They move with the unit value automatically.
A few of the ones that matter most:
Contravention | Penalty units | At $330 (offence on or after 7 Nov 2024) |
Failing to enrol, per day (body corporate) | 60 / day | $19,800 / day |
Failing to enrol, per day (individual) | 12 / day | $3,960 / day |
Program or CDD contravention (body corporate) | 100,000 | $33 million |
Program or CDD contravention (individual) | 20,000 | $6.6 million |
The enrolment one is the quiet danger. It accrues daily. Miss your deadline and sit on it, and the figure climbs every day you stay un-enrolled, not as a single hit.
The body corporate amounts are not a typo. Under section 4B(3) of the Crimes Act a court can fine a company up to 5 times the individual maximum for the same offence, which is why the company column runs so much higher.
None of this is meant to scare anyone into a panic buy. The point is narrower. When you read “100,000 penalty units” in the AML/CTF Act, you now know what that converts to, and you know it will reindex on the same day Tranche 2 commences. Build the program, enrol on time, and the number stays academic. If you would rather track the deadlines, records, and customer checks in one place than in a spreadsheet, that is what HP-KYC is built for.
The regulatory detail
A penalty unit is defined in section 4AA of the Crimes Act 1914 (Cth). Value: $313 for offences before 7 November 2024; $330 for offences on or after 7 November 2024. Automatic Consumer Price Index indexation under section 4AA(3) begins 1 July 2026 and recurs every 3 years; the indexation factor uses the All Groups CPI (weighted average of the 8 capital cities), with the March quarter as the reference quarter, rounded to the nearest dollar. The reindexation mechanism was introduced by the Crimes and Other Legislation Amendment (Omnibus No. 1) Act 2024 (Cth).
Corporate multiplier: section 4B(3) of the Crimes Act 1914 permits a fine on a body corporate of up to 5 times the individual maximum for the same offence.
AML/CTF contraventions (Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth)): failure to enrol accrues at 60 penalty units per day for a body corporate and 12 penalty units per day for an individual; civil penalty provisions for AML/CTF program and customer due diligence contraventions reach 100,000 penalty units for a body corporate and 20,000 penalty units for an individual.
Sources
ASIC, Fines and penalties: https://www.asic.gov.au/about-asic/asic-investigations-and-enforcement/fines-and-penalties/
ATO, Penalty units: https://www.ato.gov.au/individuals-and-families/paying-the-ato/interest-and-penalties/penalties/penalty-units
Crimes Act 1914 (Cth) s4AA: https://www.legislation.gov.au/C1914A00012/latest
AML/CTF Act 2006 (Cth): https://www.legislation.gov.au/C2006A00169/latest
