If you are a director of a company then this article is a must-read for you.
A new requirement for all company directors – director identification number (director ID) is coming into effect from November 2021.
This is designed to help combat illegal activity by making it easier to trace directors’ relationships with companies. Directors can apply for their director ID from November 2021 on the new Australian Business Registry Services (ABRS).
New Director Identification Numbers
Existing company directors will now be required to apply for a director identification number (director ID) by 30 November 2022, while directors of Indigenous corporations that are governed by the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act) will be required to apply for the unique identifier by 30 November 2023.
Directors must apply for their director ID themselves and will be required to produce their myGovID alongside two identity documents from a list including their bank account details, super account details, ATO notice of assessment, dividend statement, Centrelink payment summary, and PAYG payment summary.
While existing directors will have a year to apply for their director ID, new directors appointed between 1 November 2021 and 4 April 2022 will have just 28 days after appointment to apply for their director ID.
New directors who are appointed from 5 April 2022 will be required to apply for their director ID before the appointment.
Under the law, directors who fail to apply for a director ID within the stipulated time frame can face criminal or civil penalties of 5,000 penalty units, which currently stands at $1.11 million. Directors of a CATSI organisation can face penalties of up to $200,000.
Penalties will also apply for conduct that undermines the new requirements, including providing false identity information to the registrar or intentionally applying for multiple director IDs.
The new regime, passed in Parliament in June last year, is expected to cover over 2.5 million directors or roughly 10 per cent of Australia’s 25.7 million population.
The director ID will be attached to a director permanently, even if they cease to be a director, change their name, or move interstate or overseas.
The government expects the director ID regime to help prevent illegal phoenixing by ensuring directors can be traced across companies, while also preventing the use of false or fictitious identities, such as Elvis Presley or Bob Marley.
Please make sure that you have attended to this well BEFORE the deadline of the 30th November 2022 to avoid a penalty, and contact the Ceebeks Team on 55612643 if you need some help.
Thank you very much, Mam and good night! (Say this in Elvis’s voice)