The director identification number (director ID) is a 15-digit unique identifier that will help prevent the use of false or fraudulent director identities with the new registry services of the Australian Business Registry Services (ABRS). The purpose of the director ID is to trace directors’ relationships with their companies and prevent illegal phoenix activity.

There are certain director ID requirements, which the ABRS website covers in more detail, but essentially a director ID will only be given to an individual who has verified their identity with the registrar of the ABRS. Once this is done, the individual will need to conduct a proof of record ownership verification with the Australian Taxation Office (ATO).

What happens if you can’t verify your identity or pass the proof of record ownership in order to obtain a director ID? Many readers may even be thinking, “how hard can it be?”.

Well, if you are a person that doesn’t have all the standard documents required by the ABRS or ATO, you might face some troubles. If you are a member of a self-managed superannuation fund only, do not work, and haven’t lodged a tax return in five years, then you will likely face significant obstacles and not be able to apply for a director ID online. You will need to apply via phone or paper application.

While there are merits to the introduction of the director ID, it comes at the downfall of individuals that aren’t tech-savvy. There can be serious consequences with not having a director ID, but with such high hoops to jump through, it’s almost inevitable that there will be many that cannot obtain one within the required timeframe.

While agents or advisers cannot apply for a director ID on behalf of a client, we are more than happy to talk to you about this process and help you where we can.

If we can assist you in this regard, please contact our SMSF advisory team on (07) 3391 5055 or via smsfadmin@mgdwealth.com.au.

Please click here for more information about the director ID, deadlines for applications, how to apply for a director ID, and how to manage your director ID.

Any advice included in this communication is general and has been prepared without taking into account your objectives, financial situation or needs. As such, you should consider its appropriateness having regard to these factors before acting on it. Any tax information refers to current laws, is not based on your unique circumstances and should not be relied on as tax advice. Before you make any decision about whether to acquire a certain financial product, you should obtain and read the relevant product disclosure statement.