5 things directors need to know

These points cover the most important things directors should know. Read this list to make sure you’re on track, whether you’re a new or experienced director

1. Directors' responsibilities 

Know your responsibilities; authorities can fine, prosecute and disqualify you if you fail to meet your directors' responsibilities. 

You can find more detail in our guide to directors' responsibilties.

2. Directors' duties 

Be aware of your duties, these are an outline of what being a company director could involve: 

3. Profit extraction 

As a director you can take money out of a company as a salary or bonus.

Directors can't take drawings in the same way that a sole trader or partner in a businerr partnership can. If a director does take money in this way, it will most likely be treated as a directors' loan. Complex rules are in place for directors’ loans and it’s important to speak to your accountant if you have a directors’ loan. 

A director, who is also a shareholder, can also receive a dividend. Dividend income is taxed at different income tax rates, and dividens are paid out of post tax profits, meaning the corporation tax bill for the company remains the same regardless of dividends paid. read our comprehensive guide to directors' pay.

Get advice on directors' pay

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4. Company register details 

Public and private registers record director and shareholder details. Directors should therefore be aware that some of these details are accessible to all. These include: 

Speak to your accountant about using a service address to protect your personal information. 

5. Self-assessment obligations 

Directors don't have to register for self-assessment or file a tax return unless they have other reasons to do so.

Directors who have untaxed earnings, and/or taxable income above £150,000 may need to register for self-assessment. If you're new to self-assessment, the deadline for self-assessment registration is 5th October after the end of the tax year. So, if you started earning income that needs to be reported from 6th April 2024 you'll need to register for self-assessment by 5th October 2025.

While it is a simple registration process, working with an accountant from the outset can offer you tax planning opportunites and ensure you meet your commitments. Your accountant can even complete the registration for you.

How TaxAssist Accountants can help 

TaxAssist Accountants are here to help you and your business thrive. We specialise in accounts and tax for limited companies and directors. Give TaxAssist Accountants a call today on 0203 488 3777 or use our contact form and we'll be in touch.

Need more support with your taxes?

Contact TaxAssist Accountants for a free, no-obligation consultation.

0203 488 3777

Or contact us

Last updated: 30th October 2024