When Are You Classed As A Director?

You will be classed as the director of a limited company once you have successfully submitted an AP01 form to Companies House.

What is a company director?

A company director runs limited companies on behalf of shareholders.

When a company is formed, there must be at least one director and one shareholder, although they can be the same person. Once a company is created, new directors can be appointed. There is no statutory limit to the number of directors that can be appointed throughout the life of a company, unless certain restrictions are stated in the Articles of Association.

How do you register a new director?

In order to register as a new director, you must notify Companies House. You are required to complete a specific form known as an AP01 and this must be sent to Companies House. Usually, an appointment of a director is undertaken by the shareholders.

How do you resign as a director?

After the details of a new director have been registered, you are able to resign as a director. In order to do this, you must notify Companies House using form TM01 'Termination of appointment of director'. Only one director appointment can be terminated per form.

Who can become a director?

Anyone over the age of 16 is able to become a director of a company provided they:

1. Have not previously been disqualified by a Court from acting as a company director and;
2. Are not an undischarged bankrupt.

Directors do not have to live in the UK, but companies must have a UK registered office address. Directors’ names and personal information are publicly available from Companies House.

What does a director do?

Company directors are responsible for managing the company’s business activities and finances, however they do not own the company, the shareholder does. The powers and responsibilities of a director are company specific and they should be defined in the company's Articles of Association

Director duties

A company director has a number of fiduciary duties that they must adhere to, such as:

• To act in accordance with the articles of the company;
• to act in good faith in order to promote the success of the company for the benefit of its members as a whole;
• to exercise reasonable care, skill and diligence.

If a director fails to comply with their duties, then they are in breach, which can lead to a number of consequences. The most common penalties for a breach of fiduciary duty are compensatory damages, punitive damages, fees, costs, and disqualification.

Speak to our solicitors

If you have any questions regarding the appointment, termination or duties of a director, our solicitors can help. We are often instructed to assist directors who are facing disqualification for a breach of fiduciary duties. If you are in this position, we can advise how best to approach the situation. Contact us now for a free initial enquiry.