Appointing and Removing a Company Director for a UK Limited Company
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Directors are legally responsible for running a company. They areresponsible for ensuring that company accounts and reports are properlyprepared and for overall compliance for a company. A company is legallyrequired to have at least one Director.
Directors can be appointed during company formation. However, you canalso appoint or terminate Directors at later date after a company has beenincorporated. Below is small guide that explains how to appoint or removeDirectors of a UK Ltd Company
Who can bea Director?
A Director must be 16 years old or over and not have been disqualifiedas a Director in any previous positions held. A Director can be a UK or Non-UKresident and does not need to live in the UK. Overseas residents are permittedto be Directors of UK based companies.
Whatdetails do Companies House need for Directors?
The information that is required for a Director includes:
• title, full forename(s),and surname, and any former name(s)
• date of birth
• residential address
• service address / correspondence address
• nationality
• occupation
If you are appointing a new Director to an existing company then youwill also need to provide:
• company name
• company registration number (CRN)
• date of appointment of new company Director
AreDirector details made publicly available?
Directors’ names and some personal information is publicly visible onthe Companies House website. This includes the year and month of birth of theDirector, their nationality and their country of residence. A Director’scorrespondence address is also visible on the website. A Director’scorrespondence address does not have to be a UK address and does not need to betheir residential address. It just needs to be an address where someone canwrite to the Director if necessary. A Director’s residential address is heldseparately on file by Companies House and is not visible to the public on theCompanies House website.
How manyDirectors can a UK limited company have?
To incorporate a company in the UK a minimum of one Director isrequired. There is no statutory limit to the number of Directors that can beappointed to the company during or after company formation process.
How toappoint a new Director to the company?
You can appoint new Directors by informing Companies House at any time..Directors are selected by shareholders or guarantors. Shareholders can appointthemselves as Directors as well.
A company should notify Companies House within 14 days after a newDirector is appointed. You can notify Companies House either by using CompaniesHouse webfilling service or by sending a completed form AP01 to Companies Housedirectly by post.
You can also appoint a corporate Director. If you are appointing acorporate Director then you should use the form AP02. The company that thecorporate Director is being appointed to must have at least one other Directorwho is a natural person.
How can aDirector be removed from the company?
Directors can be removed or terminated from a company in one of thefollowing ways:
Resignation
Directors can resign voluntarily in accordance to their contract madewith the company. If the Director is being removed from a company via voluntaryresignation, then the company should notify Companies House within the 14 daysof resignation by using form TM01.
The form can either be submitted to Companies House online or can besent to Companies House directly by post.
You must ensure that the company has at least one natural Directorappointed at all times. This should be considered if a sole Director is beingremoved.
By ordinaryresolution
Directors can also be removed by passing an ordinary resolution undersection 168 of the Companies Act 2006. Using this procedure shareholders canpass a resolution with a majority vote (above 50%) and terminate a Directorfrom the company.
A majority shareholder automatically carries over 50% so they alone canremove a Director without the support of other shareholders.
If the resolution has been passed with a majority vote, then CompaniesHouse should be notified using form TM01 within 14 days of the removal.
Removalunder Articles of Association
A company's memorandum and articles of association can also specify thecircumstances under which a Director can be removed.
The circumstances can be as follows:
• By virtue of any provisionof the Companies Acts or is prohibited from being a Director by law.
• A bankruptcy order is made against the Director
• A registered medicalpractitioner who is treating the person gives a written opinion to the Companystating that that person has become physically or mentally incapable of actingas a Director
Removal bythe Court or other authority
Directors can be removed or disqualified by court or other authoritiessuch as Companies House, HMRC, etc. To be disqualified by a Court, a Directormust be shown to be incompetent, not meeting the requirements of the role givenin the Companies Act 2006 and / or the articles of association.
The reasons for incompetency for removal can be as follows:
• Non-filling ofconfirmation statements, annual accounts, paying taxes etc.
• Is subjected to bankruptcy proceedings
• Continuing to trade when the company is insolvent
• Under the age of 16 years
• Failing to maintain accurate accounting records
How longdoes it take for changes to be updated on Companies House register?
If you use Companies House web filling service to notify Companies Houseof a Director change then the changes should reflect on the Companies Houseregister within one working day.
Forms sent by post take a longer time to be processed and hence it cantake between 14 and 28 days for the changes to reflect on the Companies Houseregister.
We can help you to appoint and remove Directors to / from your company.If you need any assistance in changing the Directors of your company, simplyemail our customer service at info@iconoffices.co.uk