YOUR BUSINESS
f DIRECTORS of Australian companies need to apply for a unique identifier, the director ID.
A director ID is a 15=digit identification number that is unique to you.
Do you need to get a director ID? BY SMALL BUSINESS DEVELOPMENT CORPORATION
F
rom 1 November 2021, if you are the director of an Australian company or plan to become one, you will need a Director Identification Number (director ID). Director IDs are part of the Modernising Business Registers program introduced by the Australian Government, which aims to make it easier for businesses to meet their registration obligations and increase trust in business information.
Small Business Development Corporation
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WA Grower SUMMER 2021
What is a director ID? A director ID is a 15=digit identification number that is unique to you. As a director, you will only ever have one director ID that remains the same (even if you change companies, cease your role as a director, change your name or move interstate or overseas).
The new identifier has been introduced to create greater confidence in directors’ identities and combat fraudulent activities, such as phoenixing. Phoenixing is a practice that involves company directors transferring the assets of an existing company to a new company, leaving the old company with debt and putting different directors in place before liquidating it. This illegal practice is used to avoid paying creditors, including the ATO, subcontractors and employees. The new director IDs will mean that there is a record of individual director’s
history, allowing regulators to identify and track illegal activity.
Who needs one? Director IDs are now required if you are a director (or an acting director) of: • a company, a registered Australian body or a registered foreign company under the Corporations Act 2001 (Corporations Act) • an Aboriginal and Torres Strait Islander corporation registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act). You don’t need one if you are running a business as a sole trader or partnership, or are referred to as a ‘director’ in your job title but have not been appointed as one under the Corporations Act or the CATSI Act. You must be at least 18 years old and have not been disqualified from managing corporations to apply for a director ID.
