The Director Identification Number (director ID) obligates all directors in companies to register for an identification number. This is done to track a director’s relationships across companies, providing much-needed clarity and traceability in the process.
Director’s of Australian companies, a registered Australian body, a registered foreign company under the Corporations Act 2001, or an Aboriginal & Torres Strait Islander corporation need to apply for their director ID on their own since they must verify themselves as part of the process. Any acting directors, appointed directors, and alternate directors of Australian businesses and registered foreign companies, registered charities under the Corporations Act 2001, and managed investment schemes need to apply for their director IDs as well.
These requirements do not apply to unincorporated bodies, shadow directors, and company secretaries. Anyone who has obtained a director ID will have it permanently even if they no longer serve as a director.
How to Apply for a Director ID
- Create a myGovID Account
Australian citizens can apply for their director IDs online, over the phone, or in paper form. To apply online, they need to set up a myGovID account if they still don’t have one. Keep in mind that it is different from myGov since myGovID is a mobile application that enables you to prove who you are when you log into any government online service. You must include your email address and download the application on your mobile device to complete your application.
Applications wishing to apply via phone will need to call 13 62 50, if you live in Australia or +61 2 6216 3440 for anyone living outside Australia.
A paper application can be obtained from the Australia Business Registry Services (ABRS) website.
- Prepare Your Documents for Identification
The applicant must have the director’s tax file number (TFN), home address, and two verification documents. These can include passport, super account details or bank account information that can verify your identity.
- Complete Your Application
Beginning November 2021, an applicant can visit the ABRS website to apply for a director ID. They will be asked to provide their name, address, contact details, date and place of birth, and TFN. The applicant will also be required to declare that they are the individual identified in the director ID application and confirm that the information they provided is correct. They can also indicate that they are an eligible office or intend to be one within a year of applying for a director ID.
- Use Your Director ID
Once the applicant receives their 15 digit director ID number, they need to provide the details to the company’s record-holder, such as the company secretary, and an authorised agent.
If the director’s personal details change over time, they must notify the company within a week. These details can include the director’s name, address, or title. Additionally, the person in charge of maintaining the company’s officeholder’s details should inform the Australian Securities & Investments Commission (ASIC) within 28 days after the change.
When Do Directors Need to Apply?
All Directors can apply from 1 November 2021. Corporations Act Directors, who were appointed on or before 31 October 2021, have until 30 November 2022 to complete their director ID application. Any Corporations Act Directors who are appointed between 1 November 2021 to 4 April 2022 need to apply within 28 days of appointment. From 5 April 2022, all Corporations Act Directors must have applied for their director ID before their appointment.
Corporations Aboriginal and Torres Strait Islander (CATSI) directors, who were appointed on or before 31 October 2022 have until 30 November 2023 to complete their director ID application. Any CATSI Act Directors who are appointed after 1 November 2022 need to have their director ID before their appointment.
What Happens When You Don’t Comply With the Director ID Initiative
ASIC will impose criminal and civil penalties to individuals who: 1. Give a false director ID
2. Do not apply for a director ID within the deadline
3. Misrepresent their director ID intentionally
4. Apply for numerous director IDs
5. Actively contravene any of the offences above
If the individual in question does not have a director ID and cannot apply for one after being directed by the Registrar under the Regulatory Powers (Standard Provisions) Act 2014 (Cth), they could be served with an infringement notice, of 60 penalty units (which is currently worth $13,320) or 1 year imprisonment.
Conclusion
Obtaining a director ID is a necessity if you are a director or plan on becoming a director in the future. Obtaining a director ID is fairly easy and can be done online, over the phone, or using a paper form.
Wardle Partners Accountants is composed of tax experts and accountants on the Sunshine Coast, QLD. As one of the best accounting firms in the area, we can address any issues you may have about business accounting, tax, self-managed superannuation fund, and bookkeeping concerns. For inquiries about our services, contact us today.
