Company directors are now required to verify their identity by applying for a new director identification number (DIN).
This includes directors of an SMSF corporate trustee, family trust and directors acting in the capacity of an alternate director, even if they are appointed for a specified period or a temporary basis.
What is a DIN?
A DIN is a unique 15-digit identifier that a director will apply for once and will keep forever. A director can only have one DIN that they must use for all companies.
The purpose of introducing DINs is to prevent the use of fictitious director identities, assist regulators trace directors’ relationships with companies and better identify directors involved in unlawful activity.
When do directors need to apply for a DIN?
The table below summarises the key dates of when directors need to apply for a DIN.
|Date appointed as director||Date director must apply for a DIN|
|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||Before appointment|
How do directors apply for a DIN?
Directors will need to apply for a DIN themselves in order to verify their identity. This means that advisers and accountants/tax agents are unable to apply for a DIN on behalf of their director clients.
Instead, practitioners can assist their director clients by advising them of the steps and timelines involved.
Firstly, directors will need to visit the ABRS website (abrs.gov.au) and click on “Director identification number” near the top of the homepage. Otherwise directors can scroll down and click on “Apply for your director ID”.
Directors can then follow the 3-step process set out on the website, being:
- Step 1 – Set-up a myGovID
- Step 2 – Gather the documents required for identification
- Step 3 – Complete your application
The application process should take less than 5 minutes and once complete, the director will instantly receive their DIN.
Tip – directors living overseas can still apply online if they can verify their identity with myGovID.
How can directors apply for a DIN if they cannot get a myGovID?
If a director cannot get a myGovID online, they can apply by phone or with a paper form. The paper form option is a slower process and directors will also need to provide certified copies of their documents to verify their identity.
Don’t let director clients get caught out
All directors should apply for their DIN before the relevant deadline. Failure to comply with the new DIN requirements or providing false or misleading information may result in both civil and criminal penalties.
From an SMSF perspective, directors of an SMSF corporate trustee who fail to obtain a DIN may be forced to step down as a trustee and potentially leave the fund.
Directors should also take care when applying for their DIN. They must only apply via the abrs.gov.au website as it is a secure site that will keep their information safe.