Attention Directors…
Did you know that the ATO requires directors to now, legally, apply for a director identification number (Director ID).
What is it?
It is a unique identifier that a director will apply for once and keep forever – to help prevent, reduce, and eliminate false or fraudulent directorships.
The unique identity number is kept forever even if you:
- Change companies
- Stop being a director
- Change your name
- Move interstate or overseas
Why do you need a Director ID?
Stakeholders, such as shareholders, employees, creditors, consumers, external administrators, and regulators are entitled to certain details and names of the directors of certain companies.
All directors are required by law to verify their identity with the Australian Business Registry Services (ABRS), which is important as this helps prevent the use of fraudulent director identities, streamlines the process of information retrieval, and helps to eliminate director involvement in unlawful activity.
If you’re an eligible officer (director or an alternate director who is acting in that capacity) of a company, registered Australian body, or registered foreign company under the Corporations Act 2001, you will need a Director ID.
When to apply?
When people must apply for their director ID depends on when they first become a director.
- From April 5th, intending new directors must apply before being appointed
- Directors appointed on or before 31st October 2021 have until 30th November 2022 to apply
- New directors appointed for the first time between 1st November 2021 and 4th April 2022 had 28 days from their appointment to apply (must contact the ATO immediately if not done so)
Why is this so important?
Other than ensuring criminal and fraudulent activity is minimised, if you are a director and hadn’t completed the director ID set-up within the deadline, you would be facing fines.
If you have any more questions surrounding Director ID’s and anything asset finance related, please email the team on brokerteam@magnolialane.net.au or (02) 8287 3000