Any private limited business incorporated in the UK, or any foreign business expanding onto UK soil with UK offshore company incorporation, will require the appointment of at least one company director and a company secretary. If the company is to be public and have shareholders (such as a public limited company) then at least two directors must be appointed. This article explains the role of the company director, and the responsibilities that company directors face.
The Role of Company Director
A company director may or may not be involved with management of the company in question on a day to day basis, and in many cases this will be dealt with by a company manager. Having said this, all directors will have responsibilities set by law, mostly to do with keeping on top of yearly administration and the submission of information when company changes are made, taxation and health and safety.
The role of a company director is legally binding and subject to the href=“http://www.legislation.gov.uk/ukpga/2006/46/contents” target=“_blank”>Companies Act 2006. The powers and abilities of a director, and what a director can and cannot do, are outlined in the Articles of Association, which is submitted to Companies House when the company is founded. In general, a director must always act in good faith and for the best interests of the company, not treat any employees/shareholders or beneficiaries unfairly, and have a level of competence and skill expected of someone in such a position.
The Responsibilities of Company Director
Director responsibilities relate to the company’s operation, the company’s shareholders (if any) and taxation and corporate health and safety:
Responsibilities for company operation and administration include the general company annual return form (such as form AR01) and the annual accounts return form. These two yearly returns are crucial for keeping a legitimate company status. Notifying when company circumstances change is also important, and so is sending a formal account of the allocation of things like shares and dividends.
Keeping company practice up to date with changes in employment and workplace health and safety law, and taking necessary health and safety actions, including risk assessments.
Ensuring that all corporate taxes are paid on time.
A company director will often delegate these tasks to a company secretary, but no matter what the responsibility for doing these tasks and doing them properly is always that of the appointed director(s). For new business start ups, it can be advisable to contact a company formation agent or visit the Companies House website. Both are great sources of information for anyone considering setting up a new company. As well as assisting you with registering a new business, company formation agents can offer invaluable advice and support as your business grows. There are also many online government portals such as Companies house that also provide some sound advice on any issues affecting the registration of a new company.
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