What is the Director Identification Number regime?
The new Director Identification Number regime commenced on Monday 1 November 2021. If you are a company director, you are now required to have your own unique Director Identification Number - a 15 digit identification number issued by the Australian Business Registry Services (ABRS). You only need to apply for it once, and you keep it forever.
All directors of companies, registered Australian bodies, registered foreign companies or Aboriginal and Torres Strait Islander corporations will need a Director Identification Number. Directors will keep their Director Identification Number regardless of whether they become a director of another company, cease to be a director, change their name or move interstate/overseas.
The Director Identification Number regime aims to reduce illegal phoenixing activity by ensuring that the Australian Taxation Office (ATO) can properly trace directors between organisations. Director Identification Numbers are also necessary to promote good governance and significantly improve data security.
The ABRS as part of the ATO’s functions, will be responsible for introducing and maintaining the Director Identification Number regime. Click through to the ABRS Website for more information about Director Identification Numbers.
I’m a director - what do I need to do?
The Director Identification Number regime has commenced with a transitional period applying from 1 November 2021. Notably, with the commencement of the Director Identification Number regime, the following applies:
Existing directors: Required to apply for a Director Identification Number by 30 November 2022
New directors appointed between 1 November 2021 and 4 April 2022: Required to apply within 28 days of their appointment
New directors appointed from 5 April 2022: Required to apply for a Director Identification Number before their appointment
Foreign directors who have never lived in Australia (and who do not have a TFN) will need to file a paper application. Filing a paper application is a longer process as identity documents may need to be translated into English and must also be certified.
Directors located outside of Australia who need to have their identity documents certified may do so through a notary public (Bruce Carroll, Consultant within Holman Webb's Sydney office is a notary public), or staff at an Australian embassy, high commission or consulate. Copies of the identity document in its original language must also be certified.
All directors, acting alternate directors and management committee members of ‘registered bodies’ will require a Director Identification Number. Registered bodies include companies and registered Australian bodies under the Corporations Act 2001 (Cth).
How do I apply for a Director Identification Number?
The fastest way to apply for your Director Identification Number is online using the myGovID app.
If you live in Australia and already have a myGovID, you can apply for your Director Identification Number now. If you don’t have a myGovID, you can find information on how to download the app via the myGovID website.
You can also apply for your Director Identification Number by phone, by paper lodgement, or via the ABRS website.
Individuals who are currently directors, or who will be acting as directors in the future must apply for a Director Identification Number.
You must apply for the Director Identification Number yourself. A tax agent, BAS agent or similar cannot lodge the application on your behalf, because of the proof of identity documents which must be lodged with the application.
Are there consequences if I don’t register for a Director Identification Number?
Individuals who fail to register for a Director Identification Number on time, or when directed by the registrar, may be issued with an infringement notice of 60 penalty units, which on the current scale, equates to $13,320.
Individuals who apply for multiple Director Identification Numbers, or who misrepresent their Director Identification Numbers, may face up to 1 year imprisonment. Committing these offences is also a breach of the Corporations Act 2001 (Cth), for which the Australian Securities and Investment Commission (ASIC) can bring proceedings, ask a court to declare that there has been contravention, and seek further pecuniary penalty orders of up to 5,000 penalty units, or $1,110,000 (at the current scale).
ASIC can also seek that the individual be disqualified from acting as a director in the future.
For more information on the company director tracking system and registering for a Director Identification Number, please get in touch with Holman Webb’s Business, Corporate and Commercial Group today.