Although a limited company belongs to its shareholders, the company is actually run by company directors. There must be at least one company director appointed for a limited company. Directors undertake a variety of business duties which essential to ensure the success of the business.
A public limited company must legally have at least two directors, while a private limited company only has to appoint one director. If a company has only one director, they must be an actual person rather than another company. Directors have to prepare and submit relevant documents to Companies House in order to comply with the Companies Act 2006. If a company has also appointed a company secretary, the directors may delegate the duties to the secretary but ultimately, the directors are responsible.
The company annual return and yearly accounts must be submitted in a timely manner to avoid large penalties. Any changes to the company registered office or company directors should also be reported to Companies House, with full responsibility lying with the company directors.
Other than Companies House regulations, directors have to be aware of and comply with current employment law and Health and Safety law, in order to avoid cases of unfair dismissal, discrimination or unfair work procedures. Company directors have responsibility for the tax, National Insurance and VAT, making sure that correct payments are made in a timely manner. Failure to maintain the duties of a company secretary may result in a large fine, but failure to comply with other legislation may result in a criminal conviction.
Want to learn more?
Subscribe to our newsletter to get accounting tips like this right to your inbox
About The Author
An experienced business and finance writer, sometimes moonlighting as a fiction writer and blogger.