By Andrew Quinn
As a director you are now required to verify your identity as part of the new director identification number (director ID). Following the agreement of the Treasury Laws Amendment (Registries Modernisation and Other Measures) Act 2020 (Cth) all directors of a registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will now be required to have a director ID (unique identifier). The director ID aids in preventing the use of fraudulent director identities and illegal phoenixing.
A director ID is a 15-digit identifier given to directors once identity is verified with Australian Business Registry Services (ABRS). The director identification number will be kept forever, even if the director changes companies, stops being a director, changes name or moves interstate or overseas.
Previously the Australian Securities and Investments Commission (ASIC) didn’t verify the identity of directors, resulting in directors having multiple records with ASIC. The multiple records meant variations in information of name, address, and personal details. By creating a unique director identification number this allows for a more reliable and credible source of business information. ASIC can also trace a directors relationship to a company, meaning a director can’t disassociate themselves from an insolvent business.
The ABRS is now responsible for administering the director identification number. ASIC is responsible for enforcing the director ID offences as under the Corporations Act 2001 it is a criminal offence if you do not apply on time.
For more information on director ID offences, refer to ASIC’s ‘What are the director ID offences and penalties?’.
Who needs to apply for a Director Identification Number
Directors and alternate/acting directors need to apply for a director identification number. You will need to apply for a Director Identification Number if you’re an eligible officer (a director or acting in that capacity) of one of the following:
- A company of a registered Australian body or a registered foreign company under the Corporations Act 2001 (Corporations Act)
- Or, an Aboriginal and Torres Strait Islander corporation that is registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act).
When applying for a Directory Identification Number, you must apply to verify your identity, no one can apply on your behalf.
When should you apply for a Director Identification Number
Due to recent legislation, directors are now required by law to verify their identity. Any shareholder, employee, creditor or consumer are entitled to know the name and details of the directors of a company.
If you’re soon to be appointed a director of a company, you can apply before your appointment date.
For directors that fall under the Corporations Act, you must apply for your director ID by the specified dates:
- If your appointment was before 31st of October 2021, you must apply by 30th of November 2022.
- If your appointment is between the 1st of November 2021 – 4th of April 2022, you will need to apply within 29 days of your appointment.
- If your appointment is from the 5th of April onwards, you will need to apply prior your appointment date.
For directors that fall under the CATSI Act, you must apply for your director ID by the specified dates:
- If your appointment date was before the 31st of October 2022, you must apply by the 30th of November 2023.
- If your appointment date is from the 1st of November 2022, you must apply prior date of appointment.
How to apply for a Director ID
The fastest way to apply for your Director ID is online using the myGovID app. The process is quick and involves three simple steps.
- Set up your myGovID
You will need to set up your myGovID that has a strong or standard identity strength for your Director Identification Number. My GovID is different from myGov, you will need to set up your myGovID by downloading the myGovID app on your smartphone. If you live outside of Australia, you will need to apply for a director ID via paper form and provide copies of your certified identity documents.
- Documents for the ATO
You will need to provide the following information to the ATO when applying for your director identification number:
- Tax file number
- Residential address
- Two identity verification documents
They can be any of the following:
- ATO notice of assessment
- Super account details
- Bank account details
- A centrelink payment summary
- A PAYG payment summary
- A dividend summary
- Finalise your application
Your application should take a total of five minutes to complete. Once you have verified your identity with myGovID with a standard or strong identity strength, you can log in and apply for your director identification number,
Find out more information on applying for your director identification number from the ABRS here.