New Requirement for Director Identification Number - Quantiphy
 

New Requirement for Director Identification Number

October 8, 2021

All directors of a company, registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will need a director identification number (director ID).

About director ID

A director identification number (director ID) is a unique identifier you need to apply for once and will keep forever. It will help prevent the use of false or fraudulent director identities.

How director ID works

A director ID is a 15-digit identifier given to a director (or someone who intends to become a director) who has verified their identity with us. 

A director ID:

  • starts with 036, which is the 3-digit country code for Australia under International Standard ISO 3166
  • ends with an 11-digit number and one ‘check’ digit for error detection.

Directors need to apply for their own director ID and it’s free to apply.

Directors will only ever have one director ID. They will keep it forever even if they:

  • change companies
  • stop being a director
  • change their name
  • move interstate or overseas.

Why you need a director ID

Shareholders, employees, creditors, consumers, external administrators and regulators are entitled to know the names and certain details of the directors of a company.

All directors are required by law to verify their identity with us before receiving a director ID. This is important because it will help to:

  • prevent the use of false or fraudulent director identities
  • make it easier for external administrators and regulators to trace directors’ relationships with companies over time
  • identify and eliminate director involvement in unlawful activity, such as illegal phoenix activity.

Illegal phoenix activity is when a company is liquidated, wound up or abandoned to avoid paying its debts. A new company is then started to continue the same business activities without the debt. When this happens:

  • employees miss out on wages, superannuation and entitlements
  • suppliers or sub-contractors are left unpaid
  • other businesses are put at a competitive disadvantage
  • the community misses out on revenue that could have contributed to community services.

Protect your identity

Your director ID will confirm your identity and trace your relationships to companies.

Directors have obligations under the law. You should only give your written consent to being appointed as a director if you will play an active role in overseeing the company’s business affairs.

There are strict rules around how director IDs can be used. For now, your director ID will not be searchable by the public. The Registrar will consult the community about if and when this should change.

Who needs to apply and when

If you want to become a director or are already one, you’ll need a director ID. You can apply for a director ID from November 2021.

Who needs a director ID

You need a director ID if you’re an eligible officer 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).

An eligible officer is a person who is appointed as:

  • a director  
  • an alternate director who is acting in that capacity.

Directors must apply for their director ID themselves because they need to verify their identity. No one can apply on their behalf.

People who need a director ID

You need a director ID if you’re a director of a:

  • company
  • Aboriginal and Torres Strait Islander corporation
  • corporate trustee, for example, of a self-managed super fund
  • charity or not-for-profit organisation that is a company or Aboriginal and Torres Strait Islander corporation
  • registered Australian body, for example, an incorporated association that is registered with the Australian Securities and Investments Commission (ASIC) and trades outside the state or territory in which it is incorporated
  • foreign company registered with ASIC and carrying on business in Australia (regardless of where you live).

If your organisation has an Australian business number (ABN), you can use ABN Lookup to find out if it is registered with ASIC as a:

  • company, which will have an Australian company number (ACN)
  • registered Australian body, which will have an Australian Registered Body Number (ARBN)
  • registered foreign company, which will have an ARBN.

The Office of the Registrar of Indigenous Corporations (ORIC) maintains a register of Aboriginal and Torres Strait Islander corporations. These corporations have an Indigenous Corporation Number (ICN) and may also have an ABN.

People who don’t need a director ID

You don’t need a director ID if you’re:

  • a company secretary but not a director
  • acting as an external administrator of a company
  • running a business as a sole trader or partnership
  • referred to as a ‘director’ in your job title but have not been appointed as a director under the Corporations Act or the CATSI Act
  • a director of a registered charity with an organisation type that is not registered with ASIC to operate throughout Australia
  • an officer of an unincorporated association, cooperative or incorporated association established under state or territory legislation, unless the organisation is also a registered Australian body.

When you need to apply

You can apply for a director ID from November 2021.

If you are planning on becoming a director, you can apply before you’re appointed.

Corporations Act directors

When you must apply for your director ID depends on the date you become a director.

, New Requirement for Director Identification Number, Quantiphy

To be a director under the Corporations Act, you must:

  • be an individual who is at least 18 years old
  • not be disqualified from managing corporations, unless the appointment is made with the permission of ASIC or the Court.

For more information on the Corporations Act, visit the ASIC website.

 

Meeting your obligations

Your director ID obligations include:  

  • applying for a director ID within the relevant timeframe for your situation
  • applying for a director ID when directed by the Registrar to do so
  • not applying for more than one director ID (unless directed by the Registrar to do so)
  • not misrepresenting your director ID to a Commonwealth body, company, registered Australian body or Aboriginal and Torres Strait Islander corporation
  • not being involved in a breach of the above director ID obligations.

If you can’t apply by the date you need to, you can apply for an extension. Information on how you can do this will be available here in November.

If you don’t meet your obligations:

  • there may be civil or criminal penalties
  • you may be issued with an infringement notice.

Help and support

We can help you decide if you need to apply. However, we can’t apply for a director ID on your behalf.

How to apply for your director ID

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All directors need to apply for their own director ID. The fastest way to do this is to apply online.

Step 1 – Set up myGovID

You will need a standard or strong identity strength myGovID to apply for your director ID online.

If you:

  • don’t have a myGovID, you can find information on how to download the app at How to set up myGovID
  • have a myGovID, you don’t need to do anything until November when you can apply for your director ID.

 

Step 2 – Gather your documents

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You will need to have some information the ATO knows about you when you apply for your director ID:

  • your tax file number (TFN)
  • your residential address as held by the ATO
  • information from two documents to verify your identity.

Examples of the documents you can use to verify your identity include:

  • bank account details
  • an ATO notice of assessment
  • super account details
  • a dividend statement
  • a Centrelink payment summary
  • PAYG payment summary.

Step 3 – Complete your application

Once you have a standard or strong identity strength myGovID, and your documents, from November 2021 you can log in here and apply for your director ID. The application process should take less than 5 minutes.

How to apply if you cannot get a myGovID

If you can’t get a myGovID, the best way to apply will depend on your situation.

Apply by phone

From November 2021, you can apply by phone if you have:

Apply with a paper form

If you can’t apply online or over the phone, you can apply using a paper form. This is a slower process and you will also need to provide certified copies of your documents to verify your identity.

A downloadable application form will be available here in November 2021.

Manage your director ID

Once you have your director ID, there are important steps you can take to help you use, view and update your details from November 2021.

Using your director ID

When you receive your director ID, you need to pass it on to your company or Aboriginal and Torres Strait Islander corporation record-holder. This could be your company secretary, another director, contact person or an authorised agent of the company.

If you are appointed as a director of any other companies or Aboriginal and Torres Strait Islander corporations, in the future, you also need to give your director ID to the people responsible for maintaining the records of those companies or Aboriginal and Torres Strait Islander corporations.

View or update your details

If you have a myGovID, from November 2021 you can log in to ABRS online to view your director ID or update your details whenever you need to.

You can:

  • check your director ID number and status, including when it was issued
  • view things to do, actions in progress and past activity
  • edit your profile preferences and some of your personal details.

If you don’t have a myGovID, and you want to find your director ID number or update your details from November 2021 you can contact us.

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Protect your identity

Your director ID confirms your identity and traces your relationships to companies.

Directors have obligations under the law. You should only give your written consent to being appointed as a director if you will play an active role in overseeing the company’s business affairs.

There are strict rules around how director IDs can be used. For now, your director ID will not be searchable by the public. The Registrar will consult the community about if and when this should change.

As always please contact your usual Quantiphy contact if you require further assistance or have any questions in relation to this new requirement.

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