Don't forget your director IDs: The who, how and why
By Dr Kath Hall
With everything that’s been going on over the last 12 months, you can be forgiven if the requirement to get a director ID has passed you by. But if you are on a board or looking to join a board don’t delay.
As of late 2021, all directors are required by law to get a director ID. The process is free, easy and after you have done it – you get to keep your director ID for life.
- If you are already a director or became a director before 31 October 2021, you must apply by 30 November 2022.
- If you became a director between 1 November 2021 and 4 April 2022 then you must apply within 28 days of your appointment.
- If you are planning to become a director from 5 April 2022 onwards, you must apply before your appointment.
What is a director ID?
A director ID is a unique 15-digit identifier that starts with 036 (the 3-digit country code for Australia under International Standard ISO 3166) and ends with an 11-digit number and one ‘check’ digit for error detection. Your single ID applies regardless of how many boards you sit on, and moves with you if you change companies, stop being a director, change your name or move interstate or overseas.
Why director IDs?
The short answer is fraud. Director IDs will make it harder for people to avoid liability for illegal phoenix activity, money laundering, tax evasion, corruption and all forms of fraud. They will also allow regulators and administrators to trace director’s relationships with companies over time.
Director IDs are part of the Modernising Business Registers (MBR) program, led by the Australian Taxation Office in partnership with the Australian Securities and Investments Commission (ASIC) and other partner agencies. The MBR unifies the Australian Business Register and 31 ASIC business registers, including the register of companies. In effect, the system creates one source of information across all Government agencies and is managed by the Australian Taxation Office (ATO).
For those concerned about their privacy, the director ID is not searchable by the public and will not be disclosed without the consent of the Director.
Who needs a Director ID?
You need to have an ID if you’re a director of
- a company, registered Australian body, or registered foreign company under the Corporations Act 2001 (Cth), or
- an Indigenous corporation.
As many charities and not-for-profit organisations are incorporated, the scope for this requirement is broad.
If you are a committee member of an unincorporated association, cooperative or incorporated association (created under State or territory legislation) at this stage you only need a director ID if your organisation is also registered with ASIC or the Office of the Registrar of Indigenous Corporations. Otherwise, you do not need a director ID.
How to apply
You must apply for a director ID personally. The application requires you to provide information to verify your identity and begins from your myGov account.
To start, go to ABRS (Australian Business Registry Services) and log in using the same email address you used to set up your myGov account. You then need to provide:
- your tax file number
- the residential address held on file by the ATO; and
- two documents that verify your identify such as:
- Your bank account details held by the ATO (on your myGov ATO account, see ‘my profile/financial institution details’).
- Dividend statement investment reference number
- Notice of assessment (NOA) – date of issue and the reference number (on your myGov ATO account, see Tax/lodgements/income tax/history).
- The gross amount from your PAYG payment summary
- Superannuation details including your super fund’s ABN and your member account number
If your myGov account is linked to the ATO, you will find much of this information in your profile. The final stage requests your personal contact details, and the director ID is issued immediately.
The ID number should then be provided to the company secretary or office holder in relation to the boards you are on. If any of your details change, you need to update your details through the ABR.
ABOUT DR KATH HALL
Dr Kath Hall is a WOB member and Board Kick-starter presenter. An internationally recognised legal academic and writer Kath has worked with and advised a number of leading international organisations including the United Nations Joint Inspection Unit, International Bar Association Anti-Corruption Committee, Safra Centre for Ethics Harvard University, Anti-Corruption Academy Vienna, and the International Standards Organisation (ISO).
Kath is also an award winning legal educator with significant experience teaching and mentoring law students. She was one of the first Australian academics to conduct empirical research on student wellbeing and was the Australian National University (ANU) College of Law's inaugural Director of Student Wellbeing. Kath is also the co-author of the Law Student Survival Guide (3rd ed) with Professor Claire Macken.
In 2020 Kath was appointed an Honorary Associate Professor at the ANU College of Law, and since that time she has continued to engage in academic research and writing. In 2021 Kath founded Law School Success to support law students around Australia in their studies and future careers.