You’re a contractor in the UK, and you’ve just become a Director of your Limited Company. There are certain duties and responsibilities you need to be aware of – besides just making sure your business runs profitably. The Companies Act 2006 outlines your statutory duties.
Directors’ roles and responsibilities – Companies Act 2006
The Companies Act 2006 outlines the statutory duties of company directors as seven general duties;
- Duty to act within your powers as a company director
- Duty to promote the success of your company
- Duty to exercise independent judgement
- Duty to exercise reasonable care, skill and diligence
- Duty to avoid conflicts of interest
- Duty not to accept benefits from third parties
- Duty to declare interest in proposed transaction or arrangement with the company
Accounting & Back-Office Responsibilities
As a company director, you have several accounting and administrative-related responsibilities. Although you should partner with an accounting firm to perform all (or most) of these tasks, you are finally responsible that these are carried out:
- Keep good accounting records from which accounts can be prepared which give a true and fair representation of the financial position of the company.
- You must submit accurate company accounts, and file them on time with Companies House.
- You must submit your corporation tax return (Form CT600) to HMRC and pay any tax liabilities due.
- You must deal with the correct payment of staff (and yourself) – including the deduction of income tax and national insurance contributions, where they apply.
- You must trade profitably, ensuring that you are able to meet the financial liabilities of your business.
- You are responsible for completing and returning the Annual Return (Form AR01).
- Submit forms to Companies House to notify of any changes in the particulars of company director(s).
- Notify Companies House if you change your registered company address.
The list of statutory commitments and financial duties may seem daunting, however many of the requirements are not only necessitated by law but also to ensure you run a successful business. Speak to us to find out how we can help you set up and run a successful contracting business in the UK.