Legal Tip 366: Company Director Identification Numbers

The individual must personally apply for the ID BEFORE formation now, Then provide the number at formation. You may also be asked for other personal info eg TFN for any ABN registration etc. DO NOT USE ONLINE RESOURCES to apply for a ABN other then the official ATO channel. It is a major risk of fraud and some charge dubious fees for what is free. Simple. Director identification number | Australian Business Registry Services (ABRS)

You should download and use the MyGov ID app which is different to MyGov. MyGov wont help a Director ID as such. It is a resource that matches many forms of ID to verify you. Then it acts as a aproved login process each time. No more passwords (sort of!) If you have MyGov you can opt to use MyGov ID to access MyGov and it is easier once underway. I use my thumbprint around 20 times a day. Once MyGov ID with a strong ID strength is started (my strongest one is a face match to my passport and it checks every few months I am still alive). It is a identity verification resource being adopted by all agencies incl the ATO. Its a pain to get started but once done its very good and fast. Third step is then access the Director ID pathway after using your MyGov ID to prove you ...are you. Redirect which will take you straight into the ATO tool to request the ID number.

If you are outide AU or cant use MyGov etc then there is another way but expect delays and they will refuse assistance if you do have MyGov. You can apply by phone but will still need some IDs.

Apply for your director ID | Australian Business Registry Services (ABRS)

 

Yes, another control mechanism disguised to protect us...

 

it won’t protect us. It will protect ‘them’. Previously anyone could set up a company using a fake name. I think Donald Duck is a director of several companies.

this is still possible now but getting harder

 

There isnt any "control" as such. Its like suggesting birth deaths and marriages acts to control. It records information and uses it for government services. There is a whole of Govt project to put real time integrity at the heart of many dealings for authentication. . In most criminal enterprises there are fake names in use. That is known. The rollout for director IDs is just the start. OK I'm sure any clever criminal type see the two alternatives. Create a fake identity and second to assume someone elses with or without their involvement. This may increase detection risk but also still be undetected. Its tightening the regime through a complete reconstruction. Its like building a new road or rail route to replace a bad one.

In time the rollout include courts and agencies incl other records so these agencies have access to validated knowledge and data. As Directors change the ATO and others will see it.

Pheonixing is a key focus of this regime too. That cost is largely borne by the community and taxpayers. And tax fraud. Borne by taxpayers with enormous costs to police and detect.

Already in the past 6 months we have seen all super rollovers go to electronic to protect members from fraud. And enhanced use of real time reporting for salary and super so unpaid super is better seen. This is another new mechanism.

The Director ID regime is also being expanded in time to cross match credit advisers licenses and representatives and financial advisers and even business name controllers. And BANNED persons such as credit advisers, financial planners, smsf auditors and many many others. Read pages 7 & 8
https://parlinfo.aph.gov.au/parlInfo/download/legislation/ems/r6271_ems_fa2e0932-8a97-48dd-bd6f-de42ba2fff9f/upload_pdf/698110.pdf;fileType=application/pdf

 

Tend to disagree...especially in turbulent times. Perhaps my mentality coming from a country distrusting governments differs to many?
Let's say you had not paid a fine, went to a strike government didn't approve, were fined. Can now cross match all your assets and eventually help themselves to it in case you need to pay them back for some reasons.
I remember recent Canadian politicians on TV stating how anyone aiding illegal truck protests will have their accounts frozen, their assets, their companies etc...
All I am stating it's possible, doesn't mean it will happen, but enables much easier identity checks.

 

I've got (since 2008) my own Pty Ltd and have been through the ID process to get a Director ID. I'm not aware of having done anything that ties the two together. Have I missed something?

 

The ABRS requires that the ID be recorded for each Director. You dont advise ASIC. The ATO now manages this as a element of the ABN process. If your details are already linked as a Director under the ABN it will be automatically linked whn the ATO issued the ID number. You need to check that if you are a Director (future company annual statemnet will show this) online . If the details are not matched you need to correct the ABN details so it is. If you have a ASIC agent this is a automated process performed within agent edge software and synched needing no other assistance.

Manage your director ID | Australian Business Registry Services (ABRS)

 

Thanks Paul

 

Dear Registered Agent, Below is an important message, regarding director identification number (director ID) requirements, which may affect you and your clients. Australian Business Registry Services (ABRS) is responsible for delivering the director ID initiative and is contacting the secretaries of companies with new directors who have not met their obligation to apply for a director ID. Company secretaries may receive the letter (below) from ABRS. Directors must apply for their director ID themselves. However, you can assist by ensuring your director clients have all the information they need ahead of their application. The June edition of our InFocus newsletter at asic.gov.au/infocus provides guidance to help directors in successfully applying online. While directors appointed on or before 31 October 2021, have until 30 November 2022 in which to apply, ABRS is strongly encouraging all directors to apply now for their director ID. ASIC is responsible for enforcing director ID offences set out in the Corporations Act 2001. It is a criminal offence if directors do not apply on time and penalties may apply. For more information about director ID penalties, visit asic.gov.au/director-id. For more information about who needs to apply and when, including how to apply, visit abrs.gov.au/directorID.

 

I am still coming across directors who have not yet registered for their director IDs.
Just a reminder that there is just under a month to go for existing directors and new directors are required to have one before being appointed.

 

Looks like not many directors have registered
More than half of Australia's 2.5m directors could become ineligible to run companies by the end of this month

ASIC has been sending out letters I think, every director should know about this by now, but it seems many still don't

 

Assuming ASIC has the correct address. Betting many haven't let ASIC know or have no intention of letting ASIC know of their contact details. Maybe the ATO will get into it via the contact address on tax returns but some of those may not be accurate either.

 

Its a serious offence to not let ASIC know the knew address of a director and the company. I have copped many fines over the years myself for not letting them know within 14 days.

 

Many have been ignoring it. We are ASIC agents and around 50% of Directors have yet to act yet they have been issued reminders monthly for 8 months. Its becoming another unpaid chore imposed despite software that assists us.

I'm yet to understand the process here since there appears no block by ASIC on setting up a company with a Director with no ID. It would make sense to lock out new companies but there is no process to GIVE ASIC these details yet and they arent blocking setups despite what the law says. My understanding is the ATO (as manager of the ABRS) can now advise ASIC of the persons who are non-compliant so that ASIC can issue penalties to each non-compliant Director. I believe that ASIC may soon write to these people to remind them of the potential penalties Director identification number | ASIC

I would have thought that preventing issue of ABNs and TFNs to non-complaint companies a better incentive. Then the ABN / TFN process would issue the Director ID since linking Directors occurs in that process. But thats too bleeding ****ing obvious

As the offence is a crime the individual may be prohibited to act as a Director. $13K penalties does seem a bit high

 

And now the ATO assist ASIC and are moving towards a common database the risks have expanded. In recent months some ASIC changes auto flow to the ATO. eg Change of name. Changes to company. I argue its probably a part of the process to implement the common address once the IDs are all setup, Its the link much like a ABN bridges with a tax file number behind the scene. The timetable for the process is several years however.

 

All the moves made are BB in disguise, George Orwells 1984 is upon us, 4 decades late.

 

Better to be a criminal than not.



Director identification number | ASIC

 

This is getting beyond a joke...
What"TF" is this new?

I have to register my Trust and declare I am not a foreigner.

 

Just remembered the amounts are based on penalty units which are presently $222 per unit. However, in the October Budget they will increase to $275 per unit from 1 January.

 

Not quite. Its not about you.. Its about potential trust beneficiaries.

This has been state law for some time and timing varies by state. It applies to acquistions (stamp duty) and also to avoid land tax surcharges which can be backdated. I always suggest a trust register for land no matter what as surcharges are a common issue and by being registered you will be kept up to date and given ample time to comply. In NSW the rules date back to the 2016 budget and there were delays. There are some who still get detected as not complying. All it takes is an old deed that permits unfettered trustee discretion to distribute which was typical for deeds until these changes occurred. NSW was firts then other states followed. A compliant trust deed will contain clauses that prohibit foreign persons as beneficiaries without ability for that limit to be varied.

This also may affect other states. NSW is particularly aggressive as it assumes a trust doesnt comply until it verified by submission of the deed that it does,

Example

The Trang Family trust has been established a few years. Joe and Wendy Trang have lived in Australia all their lives and are citizens. Wendy does have aunts etc in Vietnam. The trust deed has clauses which allow "relatives" as potential beneficiaries. The deed should be amended even though there is no way a foreign person will be a actual beneficiary in Joe and Wendy's view.

And
The Smith Trust has been established a few years. Peter and Mary Smith are citizens. They have no known relatives overseas. NSW OSR assumes otherwise and its even possible Mary could die and Peter marry a foreign person etc. The trust doesnt comply and the deed Peter submits fails. Peter then gets it amended. However OSR wont backdate the issue and so the surcharge is imposed for past years. Peter regrets he didnt have the variation earlier by 31 december 2020

OSR NSW allowed the issue to lie dormant for a time then COVID bit and the soft approach is now not as soft

CPN 004 v2: Foreign surcharges and discretionary trusts