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Directors Duties and Responsibilities
If you decide to go into business with a contractor Limited Company you take on a number of Director Duties and Responsibilities. Unlike an umbrella company where everything is done for you, it’s your responsibility as Director of the limited company to ensure the business operates properly and stays on track with Companies House and HM Revenue and Customs among others.Director Duties include:
- Submitting statutory documents to Companies House e.g. Annual Returns, Change of Company details etc
- Ensuring Corporation Tax Returns and payments are made on time
- Completing quarterly VAT returns and making payments
- Ensuring PAYE deductions are paid to the HMRC and year end documents are submitted e.g. P35, P14 etc
- Making certain the company has suitable Professional Insurance in place as required by law
If these directors’ duties and responsibilities seem unappealing you should consider one of our umbrella company solutions. With Expat Advantage and Payroll Umbrella all you have to do is to send timesheets and expenses, we do the rest! To find out more call Commonwealth Contractors now on 0800 294 4388or Submit your details and we will get right back to you.
What happens if company documents are not filed on time?
Failure to deliver company documents such as company accounts is a criminal offence. As company director you could be prosecuted and where convicted could face a criminal record and fine of up to £5,000 for each offence. Persistent failure to deliver statutory documents on time could result in you being disqualified as a Director meaning you’re not allowed to direct a company for a period of time.However, normally things don’t get that bad as Directors receive warnings and more often than not this is enough to prompt a swift response. The worst punishment a contractor normally receives is a fine. Of course fines can add up to a lot of money if frequently punished and certainly reduce the financial benefit of running a Limited Company in the first place.
What company documents need to be filed and when?
Companies House:- Company Accounts must be filed with Companies House within 10 months of a companies accounting reference date
- Failure to deliver accounts on time results in a minimum £100 fine
HM Revenue and Customs:
- Annual Accounts, a Corporation Tax Return (CT600) and a Corporation Tax computation are required within 9 months of a companies year end. A £100 find may be applied plus interest on overdue Corporation Tax
- PAYE returns need to be completed once the financial year ends in April. Documents have fixed submission dates. Failure to submit a document on time results in a fine. Documents include:
- P14s and P35s must be received by the 19th May
- P60s must be given to employees by the 31st May
- Forms P9D and P11D must be submitted by the 6th July
PAYE deductions must reach the HM Revenue and Customs by the 19th of the month following the month in which the employee was paid.
What if I do not want to take on these Directors Duties?
Only freelance contractors happy to take on Directors Duties and Responsibilities should consider setting up and running a Limited Company consultancy.Much of the work associated with completing company documents and ensuring everything stays on track can be outsourced to an Accountant but at the end of the day the buck stops with you. If you fail to deliver company accounts or any other documents required by law you will be the one to suffer.
If you are not happy to take on Directors Duties and Responsibilities you should join an umbrella company solution such as Payroll Umbrella or Expat Advantage.
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