Director ID | Everything you need to know
So, what is a director ID?
A director ID is a unique 15-digit identification number given to a director (or someone who intends to become a director) who has verified their identity with Australian Business Registry Service (ABRS). The number is assigned once and will remain unchanged even if you leave and become director of a different company.
According to ARBS, director IDs will help to:
- give shareholders, employees, creditors, consumers, external administrators and regulators visibility as to the names and certain details of the directors of a company.
- 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 (when a company is liquidated or abandoned to avoid paying its debts. A new company is then started to continue the same business activities without the debt – leaving consumers and suppliers in the lurch.
Individuals who operate as sole traders and company administrators do not require a director ID.
How do you get a director identification number?
You can apply online for your director ID. However, first you will need to create a myGovID account which is separate to the usual myGov account.
In order to apply for a director ID, you will need to provide documents to prove your identity. These documents can include your personal tax file number, an ATO notice of assessment, or your bank details.
If your application has been certified successfully, you will obtain your director ID immediately.
Directors must complete this process themselves, no one else within the company is able to do it on their behalf. However, that doesn’t mean you can’t ask for help. We are always here to guide you through the application and answer any questions you may have.
When do you need to apply?
When you must apply for your director ID depends on the date you become a director.
If you became a director on or before 31 October 2021, then you have until 30 November 2022 to apply.
If you became a director between 1 November 2021 and 4 April 2022, then you must apply within 28 days of being appointed.
If you’re looking at becoming a director after 5 April 2022, you will need to apply for your director ID before you are appointed.
What is the ‘Modernising Business Registers’ program and how will it benefit my business?
The Australian Government’s ‘Modernising Business Registers program,’ has been designed to streamline how individual businesses can register and update their information with the appropriate authorities and registries.
While it is one of the first programs set up by the ABRS, if used efficiently the outcome for small business’ will be extremely beneficial. It will make it much more straightforward for the authorities and creditors to contact directors for any reason. The main aim is to prevent fake or illegal director identities.
The best way to be up to date on all the necessary information for your business is to work alongside your accountant. We can help streamline the process to apply for your director identification number.
Get in touch with us today to find out how we can assist you.