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Appointing or Resigning a Director in a UK Company

Appointing or Resigning a Director in a UK Company

What Overseas Groups with UK Subsidiaries Need to Know

Appointing or resigning a director in a UK subsidiary can be more complex than you might expect, particularly for overseas parent companies. There are important legal, administrative, and banking implications that need careful handling to avoid disruption. At Türner & Co., we specialise in supporting international businesses with their UK compliance, and this guide is designed to help you understand the key steps and risks.

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Appointing a Director: What You Need to Know

Appointing a new director involves more than just choosing the right person. From board resolutions and Companies House filings to employment contracts and banking mandates, each step must be handled with care.

What Does the Process Involve?

  • Drafting and passing a board resolution to formally approve the appointment
  • Filing the director appointment (Form AP01) with Companies House within 14 days
  • Updating the register of directors in the company’s statutory records
  • Reviewing and updating the employment contract, ensuring it is appropriate for a director’s position. Our HR team can help.
  • Notifying the bank to ensure that the new director can operate the company account and avoid any freezes on access
 

Director Status: More Than Just a Job Title

In the UK, a “director” is not just a title—it is a legal role with specific responsibilities. Even individuals not formally appointed can be treated as directors under UK law if they act like one (known as a de facto director). Similarly, those giving instructions behind the scenes may be seen as shadow directors.

We provide guidance to ensure your team understands the distinction between:

  • Directors
  • Managers
  • De facto directors
  • Shadow directors

 
This ensures individuals are only given the legal obligations you intend.

Wider Tax Considerations

While UK law does not require directors to be UK residents or for board meetings to be held in the UK, this can have implications for corporate tax residency.

The key issue is the “Place of Effective Management”. If strategic decisions are made outside the UK, HMRC may challenge the company’s UK tax residence. Our corporate tax team advises on:

  • Whether your UK subsidiary is UK tax resident under domestic rules
  • Whether it may be dual resident under another country’s rules
  • How double tax treaties apply and where the Place of Effective Management lies

We help you manage director appointments and board meeting procedures to align with tax and commercial objectives. Read more about our corporate tax residence services.

Resigning a Director: Key Risks and Considerations

Resigning a director is not just a matter of filing a form.

Key Risks:

  • Banking complications: If a director who is on the bank mandate resigns, banks may freeze accounts if they are not notified in time. We’ve seen companies unable to access their funds because of missed updates.
  • Incomplete paperwork: Without the correct resolution and statutory records, the resignation may not be valid.
  • Continuity issues: If the resigning director held key knowledge or authorisations, there needs to be a clear handover plan.

Our Services for Director Resignation:

  • Drafting and passing a board resolution to approve the resignation
  • Preparing and filing Form TM01 at Companies House
  • Updating the company statutory records
  • Guiding you on updating the bank and other third parties

How We Help

Türner & Co. provides a comprehensive director appointment and resignation support package, including:

Company secretarial support for statutory compliance

Drafting board resolutions and maintaining company records

Employment contract review and HR guidance

Corporate tax input on director residency and board governance

Bank notification support

We work with overseas parent companies every day and understand the specific challenges of managing UK subsidiaries remotely.

FAQs

No, UK law does not require directors to be UK residents. However, appointing non-resident directors may have implications for tax residency.
Technically, yes. But under UK law, using the title “director” can result in the individual being treated as a de facto director, with all the associated legal duties.
A shadow director is someone who is not formally appointed but whose instructions the actual directors follow. These individuals can be held liable under company law.
The Companies House filing is typically processed within 24 to 48 hours once submitted. However, updating banking mandates and other documentation can take longer.

Your bank account may be frozen until the situation is clarified. Always coordinate changes in directorship with your bank.
Board resolutions can be passed at a meeting or in writing, as long as the company’s articles of association allow it. However, the place and manner of board meetings may affect corporate tax residency.

Need help with a director appointment or resignation?

Let our experienced team guide you through the process and avoid costly errors. Contact us today to discuss your next steps.

Caroline Peverett, Director and Head of Accounting & Audit at Türner & Co

Caroline Peverett

Director

Head of Accounting & Audit

caroline.peverett@tuerner.com
+44 (0) 1636 526 075

Lotti Renwick-Bates

Manager

Audit & Corporate Compliance

lotti.renwick@tuerner.com
+44 (0) 1636 526 075

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