Directors are required to register for a unique director identification number (DIN).
A DIN is a 15-digit identification number that, once issued, will remain with that director for life. Regardless of whether they stop being a director, change companies, change their name, or move overseas.
The government implemented the director IDs to prevent potential fraud and phoenix company activity.
The director ID cannot be searched for by the public and will not be disclosed without the consent of the Director.
All directors of a company, registered Australian body, registered foreign company or Aboriginal and Torres Strait Islander corporation will need a director ID. Including directors of a corporate trustee of self-managed super funds (SMSF).
You do not need a director ID if you are running a business as a sole trader or partnership, or you are a director in your job title but have not been appointed as a director under the Corporations Act or Corporations (Aboriginal and Torres Strait Islander) Act (CATSI).
The company secretary or officeholder should keep a register of their director IDs in a secure place. DINs are governed by the same privacy rules that apply to Tax File Numbers (TFNs) and should not be disclosed unless required.
You will need to apply for your DIN before you are appointed as a director.
If you are an Australian resident director, you will need to complete a number of steps and have various identification documents available and ready to upload. For non-resident directors see foreign directors and the director ID system below.
If you haven’t already, you will need to set up myID (previously myGovID). You will need to download the myID app onto your phone or device and create an account. This only validates your identity; it does not create your director ID.
Once you have set up your myID, you need to apply for your director ID on the Australian Business Registry Services (ABRS). Use the same email you used to create your myID to start the process.
In addition to your myID, you will need to have more personal documentation on hand. documentation that matches the information held by the ATO. If you have a myGov account linked to the ATO, you can find the details on your profile. You will need:
Your tax file number (TFN)
The residential address that the ATO has on file for you
Depending on the strength of your myID, you may require two additional identity documents such as:
>>> The bank account details that the ATO has
>>> Dividend statement
>>> Notice of assessment from the ATO
>>> Your PAYG payment summary
>>> Your Australian Prudential Regulation Authority (APRA) superannuation fund details including the fund’s ABN (SMSF details are not accepted)
The final stage requests your personal contact details (not the company’s).
If any of your details change, e.g. residential address or phone number, you will need to update your details through the ABRS. You will also need to notify your company within seven days (14 days for CATSI Act directors) and the company will then need to notify the Australian Securities and Investments Commission (ASIC) within 28 days.
Foreign directors and the director ID system
Foreign directors of Australian companies have the same requirements and deadlines as Australian resident directors. If you live outside of Australia and don’t have the required Australian identity documents your will need to complete and submit a paper form to set up your director ID. Read the form carefully for detailed instructions and document requirements.
It’s important that anyone agreeing to be a director understands the implications. Being a director is not just a title; it comes with a legal responsibility.
At a financial level, directors are responsible for ensuring that the company does not trade while insolvent. The by-product of this is that the directors may be held personally liable for the debt incurred. The director penalty regime has also tightened up in recent years to ensure that directors are personally liable for PAYG withholding, net GST, and superannuation guarantee charge liabilities if the company fails to meet its obligations by the due date.
For many small businesses, the directors are also often personally responsible for company loans secured against property such as the family home. Ensure you understand the consequences before signing any documents.
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