Home Accountant ATO drops November ID deadline for resigning directors

ATO drops November ID deadline for resigning directors

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Directors who resigned before December 1 will no longer be required to obtain an identification number by November 30 as part of potential adjustments to the rules published by the ATO yesterday.

ABRS 2022/D1 sets out changes to the “eligible officers” rules that previously required anyone who was a director immediately before April 4, 2021 (when the rule was introduced), or who became a director between that date and October 31, 2021, get an ID number by the end of this month.

Anyone becoming a director after October 31, 2021 was required to obtain an ID number first, so the November 30 deadline did not apply.

The bill now excludes anyone who was a director before October 31, 2021 but resigned by the November 30 deadline.

The changes appear to address critics of the Director’s ID number system who said it cast its net too wide.

These included directors who would have been required to comply despite no longer acting in the role of an officer of the company, nor intending to do so in the future.

The explanatory memorandum accompanying the draft says:

“The categories of persons who are determined not to be eligible officers are:

  1. (a) under the Corporations Act:
  2. persons who were eligible officers immediately before April 4, 2021, but who never held a position of “director or alternate director when acting in that capacity” (director) after November 30, 2022;
  3. persons who were not qualifying officers immediately before April 4, 2021, but who became qualifying officers between April 4, 2021 and October 31, 2021, and who have never served as directors after April 30, 2021 November 2022;
  4. persons who are not natural persons;
  5. b) Under the Corporations Act, for the period from April 4, 2021 to November 30, 2022:
  6. persons eligible to be corporate officers immediately before April 4, 2021, but who ceased to exercise a directorship before December 1, 2022;
  7. persons who were not qualifying officers immediately before April 4, 2021, but who became qualifying officers between April 4, 2021 and October 31, 2021 and who ceased to hold a directorship before December 1 2022.”

CPA Australia Senior Director of Tax Policy Elinor Kasapidis welcomed the ATO project.

“CPA Australia has raised concerns about director identification requirements imposed on resigning directors. We are happy that the commissioner responded and came to a practical solution for this particular circumstance,” she said.

“As with all new programs, this kind of reactive approach to identifying directors and modernizing business records is important to minimize unnecessary disruption, streamline processes and find practical results.”

The Director Identification System is part of the Modernizing Business Registers program, which is designed to bring together multiple business databases into a single digital resource.

The bill, which is unlikely to become law until it comes into force on December 1, acknowledges the need for it to be retroactive.

Smarter SMSF chief executive Aaron Dunn said the changes eased the burden on some enterprise administrators for SMSFs, but others who had already done so. went through the director identification process might be frustrated now that he was no longer needed.

“The reality, however, is that it’s better late than never,” he said.