A Guide to Being
A Company Director in The UK>
The following guide is designed to help you understand the the role of a company director for a UK limited company.
Generally it is up to the members (shareholder\owners) to appoint the people they believe will run the company well on their behalf. The only restrictions that prevent anyone becoming a director are:
- the person must not have been disqualified by a court from acting as a company director (unless he or she has been given leave (permission) to act by a court for a particular company);
- the person must not be an undischarged bankrupt (except with leave of the court);
- the person must not be under the age of 16. There is no upper age limit.
You do not have to be a UK resident or UK National to be a director of a UK limited company.
A company director is ultimately responsible for managing the company and ensuring it remains legal and solvent. Directors are appointed by the company shareholders to run the company on behalf of its owners (the shareholders)..
Company directors have a fiduciary duty to do their best for the benefit of the company. In simple terms this means company directors should act in the best interest of the company and not themselves.
Every company director has a personal responsibility to ensure that statutory documents are delivered to the Registrar as and when required by the Companies Act. In particular, financial accounts, annual returns, notice of change of directors or secretaries or in their particulars and notice of change of registered office.
Many of these tasks are often completed by the company secretary but it remains the directors responsibility to ensure this happens.
Accounts and a tax return must be submitted to HMRC.
All the directors of the company could be prosecuted. Failure to deliver documents on time is a criminal offence. On conviction, a director could end up with a criminal record and a fine of up to £5,000 for each offence.
Alternatively, if the Registrar believes that the company is no longer carrying on business or in operation, he could strike it off the register and dissolve it. If this happens all the assets of the company, including its bank account and property, generally become the property of the Crown.
Late filing of accounts may lead to a penalty being issued to the company.
Yes. Occasionally directors are prosecuted for failing to deliver accounts and returns to the Registrar on time. This is usually the result of persistent failure to deliver statutory documents on time and may also lead to a director being disqualified from taking part in the management of a company, for a specified period.
Companies House are very good at notifying a company of its deadlines at regular intervals so it would be careless to miss a deadline. If you are unfortunate enough to miss a deadline it is best to communicate with Companies House to resolve the problem quickly and amicably before legal proceedings are instigated.
As a director of a private limited company, you normally have a maximum of 9 months from the accounting reference date in which to deliver your company's accounts to the Registrar. The accounting reference date is the date to which your accounts must be prepared.
If accounts are received late, the company will automatically be charged a 'late filing penalty'. The late filing penalty will be calculated according to the length of delay.
For further information follow this link – financial aspects of a limited company