Are you aware that in July 2018 there was an estimate of between $2.85 billion and $5.13 billion yearly loss from salaries, GST, superannuation, withholding tax and other payments, to suppliers for example, because of illegal activities by company directors. Then in the year 2011, the Australian Tax Office (ATO) reported an estimate of 6000 companies who were involved in illegal phoenixing.
Illegal phoenixing is when companies intentionally avoid or refuse to pay liabilities by closing an indebted company and transferring the assets to another company. Which in result hurts trade creditors, employees, and the public through lost taxes.
To fight against illegal activities such as phoenixing, the government of Australia has announced the full implementation of the Modernising Business Registers (MBR) program as part of its Digital Business Plan. The Director ID is the first of these initiatives.
The Director identification number or Director ID is a new requirement for all company directors, designed to help combat illegal activity by making it easier to trace directors’ relationships with companies. This initiative is expected to prevent illegal activities such as fake directors registering for boards, illegal phoenixing activities, and to help avoid the appointment of directors to companies without their knowledge or consent.
If you are a director of a company, a registered foreign company, a registered Australian body, or an Aboriginal and Torres Strait Islander corporation, then the Director ID is a must-have for you. And even if you change companies, change your name, stop being a director, or move interstate or overseas you will only have one director ID.
If you became a director on or before October 31, 2021, you can get your Director ID until November 30, 2022. If you were only appointed between November 1, 2021 and April 4, 2022 you must apply within 28 days after being appointed. And if you were to be appointed after April 5, 2022, then you must apply before assuming the position. Overall you can apply for the Director ID starting in November 2021 on the new Australian Business Registry Services (ABRS). The application will also be available starting November 2021 at www.abrs.gov.au, you will need a myGovID to apply for the DIN online, you can use this link for assistance: www.mygovid.gov.au/set-up.
Director IDs is a new hope to minimize and in the future, stop illegal activities conducted by company directors. If you need any help with setting up your mygov ID or Directors ID you can connect with us, we are here to help.
