SMSF Accountants’ Role in Ensuring Director ID Compliance
Our team of SMSF accountants is here to provide further guidance on this new requirement. As you know from our previous KSW Insight article, from 1 November 2021, all directors (or an alternate director operating in that capacity) will be required to have a Director Identification Number (“Director ID”) – this includes directors of:
- Corporate trustee, for example, of a self-managed super fund;
- A company;
- Aboriginal and Torres Strait Islander Corporation;
- Charity or not-for-profit organisation that is a company or Aboriginal and Torres Strait Islander corporation;
- Registered Australian body, for example, an incorporated association that is registered with the Australian Securities and Investments Commission (ASIC) and trades outside the state or territory in which it is incorporated; and,
- Foreign company registered with ASIC and business in Australia (regardless of where you live).
These directors must apply for a director ID no later than 30 November 2022.
If you have an SMSF and you are the director of the trustee company, you will therefore need to adhere to these new rules in relation to Director identification.
What is a Director ID, and why is it required?
As a reminder, a Director ID is a unique identifier you will keep forever, serving as a lifelong recognition for company director. This identification tool will assist in preventing the use of false or fraudulent director identities.
Directors will only ever have one director ID. They’ll keep it forever even if they:
- Change companies;
- Stop being a director;
- Change their name; and,
- Move interstate or overseas.
When do I need to register for the Director ID?
This will depend on the date on which you became a director of a company:
|The date you must apply
|Date you must apply
|On or before 31 October 2021
|By 30 November 2022
|Between 1 November 2021 and 4 April 2022
|Within 28 days of appointment
|From 5 April 2022
How do I register for a Director ID?
Directors need to apply for their own director ID to verify their identity. The application cannot be made by an authorised agent such as an accountant/tax agent, SMSF administrator or financial adviser on their behalf.
It’s free to apply.
To register for a Director ID:
Step 1: Set up a myGovID Account.
Setting up a myGovID account is the first step in the Director ID registration process. It’s important to note that myGovID is different from a regular myGov account. It is specifically designed for Director ID purposes.
Step 2: Gather Your Documentation for ID Verification
To verify your identity, you’ll need to prepare the necessary documentation. For example, your Tax File Number and ATO Notice of Assessment from your most recent personal tax return.
Step 3: Complete your application which should take less than 5 minutes.
The actual application for your Director ID is a straightforward process that can be completed in a matter of minutes. It’s designed for efficiency and convenience, taking less than 5 minutes of your time. This final step solidifies your registration and ensures compliance with the Director ID requirement.
Need more information?
For more information, please visit:
- Preparing for your director ID: https://www.ato.gov.au/Super/Sup/Preparing-for-your-director-ID/
- Who needs to apply for a director ID and when: https://www.abrs.gov.au/director-identification-number/who-needs-apply-and-when
- On how to apply for a director ID: https://www.abrs.gov.au/director-identification-number/apply-director-identification-number
If you have any questions or concerns in relation to the above, the Kreston Stanley Williamson team is here to assist you. Please don’t hesitate to reach out and contact us for guidance and discussion.
Author – Anna Wong
*Correct as of 16 December 2021
*Disclaimer – this article has been produced by Kreston Stanley Williamson as a service to its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas contained in this article, it is imperative you seek specific advice relating to your particular circumstances. Liability limited by a scheme approved under professional standards legislation.