What Does a Company Director Do? Duties Explained
A UK company director’s role and seven legal duties, filing responsibilities, identity verification, director vs shareholder and the company secretary.
A company director runs a limited company on behalf of its shareholders: they make the decisions, sign for the company, keep its records and make sure its accounts, returns and taxes are filed and paid on time. Directors have seven general duties under the Companies Act 2006 (sections 171 to 177), and since 18 November 2025 every director must verify their identity with Companies House. A private limited company needs at least one director who is a real person aged 16 or over; it does not need a company secretary.
A Director’s Seven Legal Duties
The Companies Act 2006 sets out general duties that every director owes to the company, not to themselves or to any one shareholder:
| Section | Duty | What it means in practice |
|---|---|---|
| s171 | Act within powers | Follow the company’s articles of association and use powers only for their proper purpose |
| s172 | Promote the success of the company | Act in good faith for the members as a whole, considering employees, suppliers, customers, the community and long-term consequences |
| s173 | Exercise independent judgement | Make your own decisions rather than simply following someone else’s instructions |
| s174 | Exercise reasonable care, skill and diligence | Act with the care expected of a reasonable director, and of someone with your own experience |
| s175 | Avoid conflicts of interest | Avoid situations where your interests conflict with the company’s, unless authorised |
| s176 | Not accept benefits from third parties | Do not take benefits given because you are a director, unless they cannot reasonably create a conflict |
| s177 | Declare interests in proposed transactions | Tell the other directors if you have a personal interest in a deal the company is making |
If the company is close to insolvency, the focus shifts: directors must consider the interests of creditors and avoid wrongful trading, which can make them personally liable.
What Does a Director Do Day to Day?
- Run the business: set strategy, sign contracts, hire staff and manage the company’s money.
- Keep company records: the registers of members, directors and PSCs, minutes of decisions and accounting records.
- File at Companies House: the yearly confirmation statement and accounts, and changes such as a new director or registered office. See annual filing requirements.
- Deal with HMRC: register for Corporation Tax, file the Company Tax Return, pay the tax, and register for VAT or PAYE when needed.
- Follow the rules on taking money out: salary through payroll, dividends only from available profits (declared at a directors’ meeting with minutes and vouchers), and records of any director’s loan.
- Declare conflicts: tell the other directors and shareholders if you could personally benefit from a company transaction.
You can hand day-to-day tasks to an accountant or a filing service, but GOV.UK is clear that directors remain legally responsible for the company’s records, accounts and performance.
Director vs Shareholder: What Is the Difference?
| Director | Shareholder | |
|---|---|---|
| Role | Manages the company | Owns the company |
| Legal duties | Seven statutory duties, filing obligations | Few; pays for their shares |
| Paid by | Salary (through PAYE), if the company decides | Dividends from profits |
| Appointed by | Board or shareholders, filed at Companies House | Buying or being issued shares |
| Identity verification | Always required | Only if a PSC (over 25%) |
In most small companies the founder is both. More on ownership in shares and shareholders.
Who Can Be a Director?
- Aged 16 or over.
- Not disqualified from being a director, and not an undischarged bankrupt without court permission.
- Any nationality and living anywhere in the world: a UK company does not need a UK-resident director.
- Identity verified with Companies House. New directors verify before they are appointed.
Every company must have at least one director who is a natural person. Corporate directors (another company acting as director) are allowed only alongside at least one individual director.
Identity Verification for Directors
The Economic Crime and Corporate Transparency Act 2023 made identity verification compulsory. New directors verify before appointment and give their 11-character personal code on the appointment filing. Existing directors give theirs with the company’s next confirmation statement, during the transition period ending on 17 November 2026. Full details are in director identity verification requirements.
What Information About a Director Is Public?
The register shows a director’s name, month and year of birth, nationality, occupation, country of residence and a correspondence (service) address. The full date of birth and home address are given to Companies House but kept private, unless you use your home as the service address. A director service address (£59.99 a year with a registered office) keeps your home off the public record.
What About the Company Secretary?
Private limited companies do not need a company secretary unless their articles require one. When there is no secretary, directors handle the secretarial work: keeping registers, filing changes and sending notices. Some companies still appoint one for organisation; the secretary must also verify their identity. See company secretary verification.
Becoming or Stopping Being a Director
A new director is appointed by the board or the shareholders, as the articles allow, and the company tells Companies House within 14 days (form AP01). A director who resigns or is removed is reported on form TM01. The steps, and what to do with the outgoing director’s personal code and service address, are in how to appoint or remove a director. CorpAssist files either change for £49.99 per director.
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Frequently Asked Questions
What does a director of a limited company actually do?
A director manages the company and makes decisions on its behalf: running the business day to day, signing contracts, keeping records, filing accounts and returns, paying Corporation Tax and acting in the company’s interests. In a small company the director usually also owns it, but legally the two roles are separate.
Who can be a company director in the UK?
Anyone aged 16 or over who is not disqualified and not an undischarged bankrupt (unless the court allows it). Directors do not need to be British or live in the UK. Every director must verify their identity with Companies House.
Does a private limited company need a company secretary?
No. Private companies have not needed a company secretary since 2008, unless their articles say otherwise. If there is no secretary, the directors take on the secretarial tasks, such as keeping the statutory registers and filing changes.
Is a director personally liable for company debts?
Usually not, because the company is a separate legal person. A director can become personally liable for wrongful or fraudulent trading, for personal guarantees they sign, or for some unpaid taxes, and can be disqualified for unfit conduct.
Does a director get paid?
Only if the company decides to pay them. Directors can take a salary through payroll, which means registering the company as an employer, and directors who are shareholders can also receive dividends from profits. Many small companies combine the two; an accountant can advise on the split.
Does every director have to verify their identity?
Yes. Since 18 November 2025 new directors must verify before they are appointed, and existing directors verify by their company’s next confirmation statement during the transition period ending on 17 November 2026. You verify once and receive a personal code that covers all your roles.
Official guidance: running a limited company on GOV.UK and directors’ general duties (Companies Act 2006). For questions about your personal liability, speak to a solicitor.
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