From November 2, Australian company directors can apply for director IDs, a new government initiative for tracking directorships. In this article, we’re going to explain exactly what director IDs are, who’s required to have one, and how you can get started.
What is a director identification number?
A director identification number is a new requirement being rolled out by the federal government from 2 November 2021.
Under the new Australian Business Registry Services (ABRS) initiative, Australian company directors will be required to have a unique identifying number. This ID is permanent, and is linked to the director, not the company – a director will only ever have one director ID in their life, even if they change companies, move overseas, stop being a director, or change their name.
Each director ID is a 14-digit number that starts with 036.
The Purpose of Director IDs
The reason the government has begun the rollout of director IDs is simple: having IDs for directors means people can’t escape a history of fraud and bad behaviour simply by changing their name or starting a new company.
Instead, a director ID will let the ABRS track a director’s relationships with companies more easily.
The ABRS have specifically cited ‘phoenix activity’ as a key target of the director ID initiative. Phoenix activity occurs when a director deliberately liquidates a trading entity to avoid tax, employee entitlements, debt, and other liabilities, then restarts the same business activities under a different trading entity.
Illegal phoenix activity directly costs the Australian economy between $2.85 billion and $5.13 billion each year, with costs to unpaid creditors sitting at $1,162–$3,171 million, employees at $31–$298 million, and the government at $1,660 million.
Who needs a director identification number?
You need a director ID if you’re a director or alternate director of:
- a company;
- a registered Australian body;
- a registered foreign company; or
- an Aboriginal and Torres Strait Islander corporation.
How do I find my director ID number?
You can’t simply find your director ID. Instead, you’ll need to apply for it online via the ABRS, by phone, or via a paper submission.
Your accountant or bookkeeper can’t apply for you, but they can help you navigate the process and make sure the rest of your business is compliant with current regulatory requirements.
When to Apply for a Director ID
Although director IDs will soon be a requirement for every director, the government has provided a transition period so that current directors don’t have to get an ID before 2 November.
Here’s when you’ll need to get your director ID.
- If you became a director before 31 October 2021, you’ll need to have a director ID by 30 November 2022.
- If you became a director between 1 November 2021 and 4 April 2022, you’ll need to have a director ID within 28 days of becoming a director.
- From April 5 2022 onwards, you’ll need to have a director ID before you become a director. You can apply up to 12 months before you intend to become a director.
We recommend getting your director ID as soon as possible – it’s relatively easy to do, but it is something you need to do yourself, so it’s a good idea to get it out of the way over Christmas when your business is quieter.
How to Apply for a Director Identification Number
Wondering exactly how to apply for a director ID? Here’s what you need to do.
What You’ll Need
If you’re applying online, you’ll need:
- A myGovID with a Standard or Strong identity. myGovID is an app available for smartphones; if you can’t download it, you’ll need to apply over the phone or via a paper submission.
- Your tax file number (TFN)
- The residential address that the ATO have on file for you
- The answers to two questions based on identifying documents, which can include your bank account details, notices of assessment, super account details, dividend statements, Centrelink payment summaries, or PAYG payment summaries
If you’re applying over the phone, you’ll need:
- One primary Australian identity document, and one secondary Australian identity document
- Your tax file number (TFN)
- The residential address that the ATO have on file for you
- The answers to two questions based on identifying documents, which can include your bank account details, notices of assessment, super account details, dividend statements, Centrelink payment summaries, or PAYG payment summaries
If you’re applying via a paper submission, you’ll need:
- The information requested on the submission form
- Copies of one primary Australian identity document and one secondary Australian identity document
Where to Apply
Once you’ve gathered the information you need, here’s where to apply.
Online:
Over the phone:
- Call 13 62 50
Via paper submission:
- Print and fill out this form
- Mail it (along with copies of your two identifying documents) to: Australian Business Registry Services, Locked Bag 6000, ALBURY NSW 2640 Australia
Manage Your ID
You can view and update the details associated with your director ID – including the ID’s status and date of issue – by logging into ABRS’s online portal via myGovID.
If you’re a director of a company and any relevant personal details change, you’ll also need to make sure that you inform your company within seven days of the change. The person who’s responsible for keeping your company officeholders’ details up to date then needs to notify ASIC within 28 days.
Getting Started
If you’ve recently become a director, or you’re thinking about becoming a director soon, we can help you navigate the process of getting your director ID. Our expert bookkeepers can also help make sure your business setup is fully compliant with all relevant legislation – the requirements for companies are complicated, and, if you’re new to the world of directorships, there are lots of difficult areas of law to get familiar with.
If you’re already a director of a company, we’re happy to walk you through the online process (which can get tricky, especially if you don’t have myGovID set up). We can also review your existing business setups and lodgements to ensure you’re fully compliant and not at risk of late fees or other penalties.
Ready to get started?
Talk to one of our expert bookkeepers.
