Who Owns the DIN Shortfall?

24 Nov 2022

Written by

David Busoli, Principal

There’s an old, inflation adjusted adage that if you owe the bank $1M and can’t pay it, you have a problem, but if you owe the bank $1B and can’t pay it, the bank has a problem. This might reasonably be applied to the shortfall in director identification number applications as the deadline is only days away.

Around 800,000 directors will have failed to apply with about a third of these being SMSF related.

Undoubtedly, one of the reasons for this shortfall has been the digital process and the inability for this to be outsourced. Recognising this, in the last couple of weeks paper forms have been resurrected and mailed to errant directors.

Another reason for the shortfall is our general tendency to leave things to the last minute – around a third of all applications have been received since October.

Missing the 30 November deadline could involve a maximum criminal penalty of $13,200, or up to $1,100,000 under civil law but, given the large percentage of the director population that will have failed to comply, the ABRS have a problem.

As DINs are required to clamp down on dodgy dealings there is no doubt that, ultimately, directors who fail to apply will be subject to penalties, but I’d be confident that we can expect an extended deadline to be announced in due course and, in any case, directors who have failed to apply in time will be given the opportunity to explain why. That said, applying now will save a whole lot of unnecessary additional work so please keep the pressure on your tardy director clients

The ATO’s latest update and links to apply are here.

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