Current and future company directors in Australia will soon be legally required to apply for a unique director identification number (DIN). The DIN provision is part of the Treasury Laws Amendment (Registries Modernisation and Other Measures) legislation that was passed in federal parliament in June 2020.
According to the latest statistics compiled by Australia’s corporate regulator (the Australian Securities and Investments Commission), there are more than 2.8 million registered companies in Australia.
Details of the DIN scheme are being progressively released by the Treasury. Here is what we know so far.
The intended purposes of director identification numbers
The aims of the DIN scheme are to:
- prevent fictitious company directors from being appointed.
- enable company director profiles (including director relationships to companies) to be traced over time. For example, any previous involvement with companies that are now insolvent
- reduce illegal phoenix activities. This is where a new company is created to continue the business trading of a company that has been liquidated to evade debts to creditors, staff or the Australian Taxation Office (ATO).
Directors will need their DIN to interact with any government agencies once the scheme is up and running.
Information that directors will need to supply to get a DIN
Company directors will need to supply the following information to the Commonwealth Registrar to get a DIN:
- current name (including proof of identity via an Australian driver’s licence, passport, Medicare card, birth certificate or visa).
- any former name/s (if applicable).
- date and place of birth.
- current and former addresses.
- current contact details.
- tax file number (TFN). It’s not compulsory for directors to provide their TFNs, but the Commonwealth Registrar has the power to request TFNs from the ATO under the provisions of the DIN scheme. The Registrar also has the power to link and verify any information provided by directors to their respective ATO records.
Only one DIN will be made available to a director, even if a person is a director of multiple companies. This will facilitate director traceability under the DIN scheme.
Penalties for providing misleading DIN information or not having a DIN
The Treasury Laws Amendment (Registries Modernisation and Other Measures) legislation provides for both civil and/or criminal penalties for providing misleading information when applying for a DIN, or not registering for a DIN at all.
How and when to register for a DIN
Details are still to be provided by the Treasury. There is no need for directors to register yet. A transitional time frame for current directors to register is expected to be announced soon. Once the DIN scheme is operational, new directors will have 28 days to apply.
How we can help
Contact us if you need any advice on how this new DIN requirement will affect you or your business. Our experienced team of specialists in Richmond can also help with any other business accounting or tax services you may require. We are a full-service accounting firm and can tailor our services to suit your specific needs.