In June 2020, the Federal Government passed the Treasury Laws Amendment (Registries Modernisation and Other Measures) Act 2020 (Cth), requiring all new and existing directors to obtain a Director Identification Number (DIN).
Resultingly, Part 9.1A was inserted into the Corporations Act 2001 (Cth) (‘Corporations Act’) and Part 6-7A into the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (‘CATSI Act’). These new parts set out the requirements to obtain a DIN and offences for failure to do so.
1. What is a DIN?
A DIN is a unique identifier number comprised of 15 digits issued to directors to verify identity. Directors need only apply once for a DIN as it is permanently assigned to the director.
2. What is the purpose of a DIN?
The Australian Business Registry Services (ABRS), which is overseen by the Australian Tax Office (ATO), is the body responsible for the implementation and administration of DINs. The ABRS notes the purpose of the regime is to help prevent the use of false or fraudulent director identities, ease the tracing of directors’ relationships over time for external administrators and regulators and to combat unlawful director activity such as illegal phoenix activity.
3. Who needs to apply and when?
A DIN is required for directors and acting alternate directors of:
- a company, registered Australian body or registered foreign company under the Corporations Act;1 and
- an Aboriginal and Torres Strait Islander corporation under the CATSI Act.2
When a director must apply for a DIN is dependent upon the date of appointment.
The table below sets out the requirements for Corporations Act directors.3
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Date the individual becomes a director
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Date the individual must apply for a DIN
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On or prior to 31 October 2021
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By 30 November 2022
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Between 1 November 2021 and 4 April 2022
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Within 28 days of appointment
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5 April 2022 onwards
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Prior to appointment
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The table below sets out the requirements for CATSI Act directors.4
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Date the individual becomes a director
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Date the individual must apply for a DIN
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On or prior to 31 October 2022
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By 30 November 2023
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1 November 2022 onwards
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Prior to appointment
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4. Implications for charities and not-for-profit organisations
The DIN requirements apply to all ‘registered bodies’ which is inclusive of charities and not-for-profits even if the organisation is registered under the Australian Charities and Not-for-profits Commission Act 2012 (Cth). Obtaining a DIN is not necessary for incorporated associations which are not registered Australian bodies. Therefore, directors of charities and not-for-profit organisations are required to have a DIN.
5. How to apply
Applications for a DIN must be made personally and are at no cost.
Directors who are Australian residents can apply with a paper form or online through the ABRS website which requires a myGovID account. Foreign directors must fill out a paper application with the necessary identity documentation.
6. Non-compliance
It is essential that directors comply and keep up to date with DIN requirements as both civil and criminal penalties apply for non-compliance. The Australian Securities & Investments Commission (ASIC) is responsible for the enforcement of associated offences set out in the Corporations Act. Relevant offences include failure to have a DIN when required, failure to apply for a DIN when directed by the Registrar, applying for multiple DINs and misrepresenting director ID. Non-compliance may result in an infringement notice leading to potential civil penalties of up to 5,000 penalty units (currently $1.1 million) and/or criminal penalties resulting in up to 12 months imprisonment.5
Article written by Mills Oakley
About Mills Oakley
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Our comprehensive expertise, in conjunction with our entrepreneurial spirit and national reach, means that we are ideally placed to provide the highest level of service.
For more information, visit www.millsoakley.com.au
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1Corporations Act 2001 (Cth) s 1272C (‘Corporations Act’).
2Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) part 6-7A (‘CATSI Act’).
3Corporations Act (n 1) s 1272D.
4CATSI Act (n 2) s 308.25.
5Corporations Act (n 1) sch 3.
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