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New director ID sparks red tape fears

Adam Zuchetti
Adam Zuchetti
12 September 2017 1 minute readShare
Red tape

While being touted as a means of reining in dodgy practices by rogue directors, the Director Identification Number (DIN) proposal has raised fears that SMEs will be tied up in yet more red tape.

Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell welcomed the move to introduce the DIN, but suggested the implementation could bring unintended burden for business owners.

“We support a unique identifier that will enable identification of rogue directors to ensure they can’t be involved in multiple instances of phoenixing,” she said in a statement.

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“The challenge for the government is to ensure this is not just another number with more red tape.”

Ms Carnell noted that businesses already need to jump through hoops and complete significant paperwork to receive and maintain their Australian Business Number (ABN), Australian Company Number (ACN) and Tax File Number (TFN), as well as other industry and regulatory required licences and documentation.

 

“We want to see a scenario where all of this data is consolidated into a single portal that contains all relevant information.”

The government is hoping that by having registration of individual directors, it will be able to better track ownership of companies and establish links between previously unrealised related entities.

Theoretically, the implications could be far-reaching, enabling the government to better track tax liabilities and a range of other uses.

My Business understands that at present, ASIC does not retain data on companies that are wound down, given the high turnover volume.

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What are your thoughts – is the Director Identification Number (DIN) a good idea, or simply more paperwork for already lumbered business owners? Share your thoughts below.

New director ID sparks red tape fears
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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