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How to Be a Good Director

by Jane Hailstone | Apr 30, 2015

When you start your own limited company, suddenly you are a Director. You probably don’t feel any different, you don’t look any different, nobody will probably even notice, but you now have a new title. And it means something.

It means you have the freedom of calling all the shots for your business and deciding the routes it takes. It also means that you have responsibilities and obligations that you might not have had before, depending on what you did before you decided to start your limited company. You are legally responsible for what you have created and there are a number of tasks that come with it.

  1. Want it. Many people start companies because their clients have requested it or for a number of other more obligational reasons. If you don’t really care about running your own company and aren’t interested in it then you will likely not put so much effort into it. It is your legal responsibility as Director to do everything in your power to ensure the business succeeds. You will fare better at making your company a success if you actually want the business and everything that comes with it.
  2. Be organised. If organisation doesn’t come naturally to you, then there has never been a better time than when you start a new company to learn that skill. As Director, you will be responsible for submitting tax returns, keeping financial records, keeping company records and submitting company annual returns, and there are hefty penalties for failing these tasks. On top of these legal responsibilities, you will need to keep track of expenses, contract applications, and IR35 assessments and so on, for the general running of your business. Keeping organised files and calendars is advised for keeping everything in check.
  3. Be a good salesperson. As a contractor, you will need to generate business for your company. You will therefore need to learn how to market your business whether it is with online tools or personal networking. Being able to do your work is only half the challenge, you also need to be able to secure your contracts and get your company name out there. You will need to set some time aside for marketing and contract hunting.
  4. Have a mind for finances. On top of all your other responsibilities, you will also need to take care of how you withdraw funds from your business and you will be responsible for the accuracy of your accounts. Most contractors will appoint an accountant for their finances, which is all well and good, but remember that the responsibility for your accounts falls back on you, the Director. Being a good Director means taking some active interest and handling in your accounts, regardless of how much your accountant takes care of for you.

There are many responsibilities and obligations to being a Director of a company but if you want to own your own company, then most of them should come reasonably naturally. Make a list of all the tasks that are required, monthly and annually, and keep a calendar to ensure you don’t miss any deadlines. Try not to leave filing tax returns until the last minute and keep all receipts, relevant correspondence, contracts and IR35 assessments in an organised file so your administration doesn’t get the better of you.

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