Director ID
Everyone has a Tax File Number (TFN), and some have an Australian Company Number (ACN) or Australian Business Number (ABN) but now some people are also going to need a Director ID Number. So many ways to identify you!
WHAT
This is a new thing, launched 1 November 2021. It will be a unique 15 digit ID number for all Company Directors. So, if you are a sole trader you do not need one. But if you are a Director of a Company then you probably do.
It will act like a TFN in that you get one number, and it exists for the entirety of your life. You keep the same ID number even if you are the Director of multiple Companies or you cease to be a Director.Thank goodness, otherwise you would end up with so many numbers. One is enough.
Once you have your ID you will be able to see it in MyGov, so no need to try to memorise it. For now the ID won’t be publicly available (as in not on a public register or searchable) but it is not quite as private as a TFN - it would be ok for you to disclose your ID number to people you trust and to your accountant, Government organisations etc.
WHY
The ID is a way of verifying the identity of the Directors of a Company.
There are a few key reasons why this is needed (I actually can’t believe we haven’t had this from the start!):
- Regulators can track who is a Director of what Companies more easily
- It prevents people starting Companies with fictitious Directors
- Track Directors of failed Companies in case there is a trend and perhaps those Directors need a bit of a talking to (or more extreme measures in addressing that issue)
- One point of truth with accurate, reliable personal details for each Director (no more spelling mistakes and address changes missed)
- Avoid Companies being registered with Directors not being notified of their registration
WHO
Essentially ALL Directors and Alternate Directors will need to have a Director ID. This includes eligible officers of
- a company, a registered Australian body or a registered foreign company under the Corporations Act 2001 (Corporations Act)
- an Aboriginal and Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act).
You do not need a Director ID if you are:
- Sole trader
- Partner in Partnership
- Company Secretary
That said, if you are intending to become a Director then you can apply for your ID now before you officially become a Director. However, if you don’t become a Director/get linked to a Company within 12 months the ID will expire and you would need to reapply when ready.
Check who needs to apply and when here.
|
Date you become a director |
Date you must apply |
|
On or before 31 October 2021 |
By 30 November 2022* |
|
Between 1 November 2021 and 4 April 2022 |
Within 28 days of appointment |
|
From 5 April 2022 |
Before appointment |
*Director of Aboriginal and Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act), appointed before 31 Oct 2022, will have until 30 Nov 2023.
HOW
The process itself is super easy and it’s done online in about 15 minutes - the one catch is that you (the Director) have to do it yourself. As your accountant I cannot do it for you, sorry.
Here is the link to begin the registration process.
Steps to expect:
- Set Up MyGovID (which is different to ‘MyGov’... they just love using super similar names)
- MyGov is an account
- MyGovID is an app
- Gather your documents:
- TFN
- Residential address (per the ATO)
- 2x verification documents, out of these:
- Bank account details
- ATO Notice of Assessment
- PAYG payment summary
- Superannuation account details
- Dividend statement
- Centrelink payment summary
- Complete your application online (or click link above and follow the prompts)
If for whatever reason you prefer a phone or paper method, these can be arranged too.
PENALTIES
Basically there is a penalty of $222 per unit, and each offence has a different number of ‘units’ applied. For example, failure to apply for a Director ID prior to appointment or within the period allowed (like the 28 days etc.) is 60 penalty units so it could result in a decent fine.
There are a bunch of non-compliances and related penalties.
Just get it done, fam.
As always my loves, I am here to help you through this so if you get stuck, reach out!
xxx Lauren
