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Director Identification Numbers And What Companies Might Need To Do To Get Prepared

Posted on October 24, 2021 by admin

Did you know that there are 31 different business registers that a business or company may need to be registered with that are a part of ASIC? Some of these registers are being brought together, in what will be known as the Australian Business Registry Services (ABRS).

The Commissioner of Taxation was appointed in April 2021  as the Commonwealth Registrar of the ABRS. In the near future, registering a company will be done through the ABRS instead of ASIC. This is a part of the government’s move towards a more efficient digital economy.

Previously, a company or business was registered through ASIC, where a Tax File Number and an Australian Business Number would be required. These are obtained through the Australian Taxation Office (ATO) and are a critical part of setting up a business or company.

Beginning from November 2021, there will be an additional step introduced in the registering of a company, involving a Director Identification Number (DIN).

This director identification number is a unique identifier that a director will apply for once and keep forever.

Every company director will need to have a DIN prior to 30 November 2022, with Indigenous directors having an additional year (till 30 November 2023) to adhere to the new requirement.

This applies to directors if their organisation is a company, registered foreign company, registered Australian body or Aboriginal and Torres Strait Islander corporation.

In the future, registering a company will be done through the ABRS instead of ASIC. This is a part of the government’s move towards a more efficient digital economy.

Directors will need to apply for their director ID themselves because they will need to verify their identity. Eligible persons that have sufficiently established their identity, will be provided a DIN that they will keep for their lifetime – even if they cease to be a Director.

No one else will be able to apply on their behalf.

The new DIN Requirements apply to appointed Directors and acting Directors of Australian corporations and registered foreign companies, which includes those companies who are responsible for managed investment schemes and registered charities. This is set out under the Corporations Act 2001 (Cth). 

As of the time of writing, the DIN requirements do not extend to unincorporated bodies, de facto or shadow Directors, or company directors.

DIN’s will be recorded in a new database to be administered and operated by the Australian Tax Office and be made available to the public.

The ATO will also have the power to provide, record, cancel and re-issue a person’s DIN. A DIN will be automatically cancelled if the individual does not become a Director within 12 months of receiving the DIN.

Following the DIN, the ARBS will then take over the Australian Company Register, the Business Names Register, and the Australian Business Numbers (currently on the Australian Business Register).

The ABRS is responsible for the implementation and administration of director IDs. ASIC will then be responsible for the enforcement of associated offences.

It is expected that around 10% of all Australians will require a DIN.

Despite the small number, it is a crucial part of the plan to prevent and halt phoenix directors from being appointed to companies, who then rack up significant debts that no one is held accountable for.

It is believed that this change will make the process cheaper, faster, and easier, as companies will no longer need to be first set up through ASIC before dealing with the ATO for an ABN and TFN.

If you currently have a company and do not already possess a MyGov account, now is the time to rectify it in the move towards DINs.

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Looking To Upscale Your Business? Here’s What You Need To Know…

Posted on August 14, 2022 by admin

It’s a wonderful feeling when you have reached a point where your business is so successful that you need to upscale. Whether hiring more people or moving location, upscaling has its unique challenges. What can you do to ensure that you are hitting the ground running while upscaling?

Set Realistic And Actionable Goals

Businesses should set realistic and actionable small goals which they can work towards, rather than broad goals which provide no direction. Setting broad and unrealistic goals is demotivating and makes any progress made seem insignificant. Every person in the business should be given a target to meet over a reasonable timeline, contributing to achieving a larger goal.

Establish Standardised And Automated Processes

Small businesses can make the mistake of ‘doing things as they come’, but this means that as the business grows, adjusting to high-scale tasks is difficult. To avoid this, businesses should standardise all processes of work. Any individual placed into a role should be able to follow standardised procedures and yield a product that is of similar quality to the previous one. Investing money into automation tools is worthwhile for this procedure. This can include automating social media management, email, and customer relationships. Both of these will contribute to creating structures that support growth.

Identify Competitive Strengths And Weaknesses

Recognising the strengths and weaknesses of one’s business is essential. Strengths will allow businesses to hone in on their unique qualities, giving them a competitive advantage. Weaknesses will reveal which areas require growth so that changes can be made before upscaling takes place.

Network

Businesses should continue to develop relationships with service providers, sales channel partners, suppliers and customers. Keeping an open mind about partnerships or potential collaborations could open up different avenues of business growth.

Anticipate The Adjustment Pace.

No matter how prepared you feel, any change in an organisation will require a period of adjustment for the rest of your team. Give them time to recognise the need for change and accept this opportunity’s challenges. More importantly, they need time to understand their roles in the bigger picture of your organisation’s plans to scale and determine how they can make the most of their skill sets and add value to the company. Make sure to consider adjustment protocols and allocate a reasonable period for such adjustments in your scaling plans and process.

Outsourcing The Non-Essentials

As the business increases in stature, there will be a lot more little and frustrating tasks, meaning that you can’t focus on what’s important. Outsourcing components like payroll or marketing to companies with the professionals to do it effectively means that you can focus on upscaling the business.

Upscaling can be very stressful, but whether it’s making changes to your business’s technology or outsourcing things in the short term, to upscale a business means focusing on what is best for your business.

To get to this point, you’ve made a success of it, so it’s important not to lose your identity in the process. Upscaling your business is taking what’s great about your current operation and building it outwards.

If you are looking towards how your business can take itself to the next level, business planning for any eventualities can be of benefit. Consulting with a trusted adviser can be of great help when moving forward in your business’s upscaling endeavour.

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