Confusion around director IDs continues as deadline looms
With only a month left until the deadline, it’s still unclear whether former directors that have lost capacity will need to apply for director IDs, says Heffron.
In a recent article, Heffron head of SMSF technical and education services Lyn Formica reminded directors of corporate trustees that they will need to apply for a director ID by 30 November 2022.
Despite the deadline fast approaching, Ms Formica said there is still a lot confusion around who needs to apply.
Ms Formica warned that some former directors may not be aware that anyone who was a director of a company on 31 October 2021, has since ceased all of their directorships, and has no intention of ever being a director again will still need to apply for a director ID.
“For example, someone who wound up their SMSF and deregistered their trustee company since 31 October 2021 still needs a director ID,” Mr Formica explained.
“The legislation simply didn’t build in carve-out for these former directors.”
While the ATO has recently confirmed that they will provide an exemption for directors who have since died, Mr Formica said the industry is still waiting for a similar exemption for other former directors, including those that have lost mental capacity.
“Hopefully this confusion will be resolved shortly,” said Mr Formica.
Last month the government launched an awareness campaign for director IDs targeting SMSFs as well as small business, charities, and not-for-profits.
ATO data last week revealed that less than half of the 690,000 directors in the SMSF sector were yet to apply for an ID.
The uptake is even worse for the overall director population, with ATO figures to 19 October revealing around 1 million directors had applied for an ID from an estimated population of 2.5 million.
Miranda Brownlee
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.
