Close to 2.5 million directors will soon be required to apply for a unique director identification number as the Treasury reveals
more details on the incoming program.
Laws passed in June last
year will
soon see new and current directors required to apply for a director identification number (director ID) which they will keep permanently,
even if they cease to be a director.
The government expects the director ID regime will help prevent illegal phoenixing by ensuring directors can be traced across
companies, while also preventing the use of fictitious identities, such
as Elvis Presley or Bob Marley.
The Treasury expects 10 per cent of Australia’s 25.7 million population to apply for a director ID, with the new program to be
administered by the Commonwealth Registrar under a separate statutory function of the ATO.
New details released by the Treasury have now revealed that directors will be required to provide their names and former names, addresses
and former addresses, contact details, and their date and place of birth.
Applicants will need to prove their identity using key Australian identity documents, with accepted documents to include a driver’s licence
or learner’s permit, passport, birth certificate, Australian visa and Medicare card.
The Registrar may also request for the director’s tax file number (TFN), but it cannot compel them to disclose it. However, the Registrar
may ask the ATO to provide the TFN of an individual who has applied for a director ID to verify the identity of the individual.
Director details provided to the Registrar may also be authenticated by linking the individual’s information to ATO client records.
What now?
The Treasury is expected to release more details over the coming weeks on transitional arrangements for directors to apply for
a director ID.
Until the legislative instrument has been made, there will be no requirements for directors to apply for a director ID.
Existing directors will be given an unspecified time frame to apply for a director ID once the regime comes into effect.
Those appointed as a director within the first 12 months of the new regime’s operation will also be granted an additional 28 days to apply
for a director ID.
After the transitional period ends, individuals will be required to apply for a director ID prior to being appointed as a
director.
There will be civil and criminal penalties for directors who fail to apply for a director ID within the applicable time frame, and
for conduct that undermines the new requirements, including providing false identity information to the Registrar or intentionally applying
for multiple director IDs.
SOURCE: AccountantsDaily