ASIC has moved to prevent people using false Company Director identities to rip off customers, employees, subcontractors, lenders, and of course, the ATO. So all Company Directors have to have a registered identity. But time’s running out on Director IDs for existing Directors.
A Director ID is a unique 15 digit identifier, verified against your key documents. You only need one Director ID, it lasts for your lifetime, and you can use it for all your Directorships.
The requirement applies to all Directors of a company, registered Australian body, registered foreign company, or Aboriginal and Torres Strait Islander corporation.
Director IDs for Existing Directors by end November 2022
If you were a Director before 31 October 2021, then you have until the end of November to apply for and receive your Director ID. So do it now.
This also applies for Alternate Directors, no matter how uninvolved they may be in the business.
Director IDs for Recent and New Directors
If you became a Director after 1 November 2021 and you haven’t got a Director ID, you need to get one immediately. You are actually in breach of the law.
For all new Directors, you are supposed to get a Director ID before you are appointed. To make this process easier, you can apply for a Director ID up to 12 months before you are appointed.
How to Apply for a Director ID
The Director ID process is run by Australian Business Registry Services (ABRS).
It’s free, and the easiest and quickest way to apply is online, using the MyGovID app on your phone. If you haven’t got a MyGovID, you can set one up. If you can’t, you can call ABRS and apply for your Director ID by phone.
Remember, MyGovID is not the same as MyGov (who named these things?).
If you live outside Australia, you have to apply on paper.
You must apply yourself, personally. You can’t get anyone else to do it for you.
If you are applying online with MyGovID, you have to confirm information the ATO already has about you. You’ll need:
- your Tax File Number (TFN)
- your residential address as held by the ATO
- information from two documents to verify your identity.
The two documents can be any of:
- bank account details
- an ATO notice of assessment
- APRA fund account details
- a dividend statement
- a Centrelink payment summary
- a PAYG payment summary (this is different to your income statement or your PAYG instalment activity statement).
For more information and to apply, see Australian Business Registry Services.
What to do with your Director ID
You don’t have to do anything with it. You don’t have to inform any organisation. You may be asked for it for any new appointment. It is an offence to give a false Director ID or to have more than one.
Watch Out for Director IDs in Small Businesses
Sometimes in small business you may need a new Director urgently, within a day.
Because new Directors must have an ID before they are appointed, this can cause problems. And because Director appointment is recorded in Company Minutes, you can’t say you didn’t do it. You may end up liable for a fine.
Another possible issue is the appointment of Alternate (or backup) Directors. They also must have a Director ID before appointment, even if they never sit in a meeting.
These new laws suggest small businesses have to plan Director changes a little more carefully.
Need advice on your Director or Company setup? Book a free consultation with us.
