Hi Gökhan, thank you for your feedback. We are glad that you have found this video useful! Is there anything else that you would like us to cover for next time?
Hi Laura! Thank you for your kind feedback. We are always happy to help and answer any questions you have as best we can. Is there anything else you would like us to cover?
Hi M.N. Ahmed! Thank you for your feedback. Please feel free to check out the rest of our channel for more guidance and information on the world of company formation. Is there anything, in particular, you would like us to cover?
Hi Peter, thank you for your kind comments. We are glad that you have found this interesting. Is there anything else that you would like us to focus on for next time?
Wow! From what appears at first glance to be a very simple and straightforward topic, it is actually a complex issue as the answer to the question very much depends on circumstances. A very interesting watch - - well done Team 1st Formations! Quick question: if I wanted to create a director's service agreement - who would do this for me?
Hi Graeme! Thank you for your feedback. Yes, absolutely the topic is actually far more complex than it originally seems but we hope we have helped you understand this more thoroughly. A solicitor is a type of lawyer who would be able to assist you in drafting a director's service agreement. Is this something you are looking to do?
@@1stformations Yes, my company is at the stage where I am considering appointing additional directors, so creating directors' service agreements is something that I will need to address. I will take the matter up with my solicitor. Thank you again for your kind advice.
Hi Miles! No problem at all. That is great news. Please feel free to check out our blog pages here for more information regarding company formation: www.1stformations.co.uk/blog/category/company-formation/ What type of business are you looking to set up?
@@mileshogg4918 Hi Miles, yes absolutely! We have an eSeller package that is ideal for ecommerce and dropshipping. For more information, please see our eSeller package here: www.1stformations.co.uk/compare-packages/#eseller Is there anything else we can help you with?
You are welcome, John. What a great question. A director's service agreement can have anything you would like within the contract. However, most contracts typically include the basics such as terms of employment, holiday entitlements, duties, benefits, etc. However, if you as the employer wish to include other aspects to the contract, you are more than welcome to do so. Does this help?
Hi Adam! Thank you for your comments. Some companies actually give out the job title 'Director' without appointing them officially on Companies House. This is permitted, and so long as they are not actual officers of the company then this does not need to appear on Companies House. What else would you like to know?
What if a company (Ltd) only has two directors. They both carry out services for the business ...and derive a net profit at the end. How do you account for their shares? Obviously they dont want to be considered employees, as theres only two of them (say couple 50/50). How do you account in the financial statements what they should get? Through dividends? Or shares? Share holders' equity? Have seen this come up many times and read that when the couple takes funds for themselves after net profit that this should be taxed. Can anyone explain or help?
Thanks for the question. I'm afraid we can't advise from a tax or accounting perspective, nor can we advise from an employment perspective. However, in the first instance we would note that the payment of directors for their services is usually set out in their service agreement with the company. I am assuming that the two directors are also the two shareholders of the company also, in which case they could also be paid in dividends (either instead of, or in combination with, a salary). The actual amount of dividend they receive is dependent on the amount of dividend that is declared (the amount that is declared is usually approved by the shareholders, i.e. a final dividend, or by the directors, also known as an interim dividend). The amount of shares they hold (and structure of the company's share capital) then inform how much of the dividends they themselves will receive. We hope that helps!
Hi Keziah. Yes, speaking with an accountant or a HR expert would be a great place to start to get a written service contract drawn up as they have the knowledge and expertise to get these done for you. What were your thoughts on this week's video? We would love some feedback!
As a Non Resident director how should I pay myself from the company? Can I set variable salary for directors? Because we are not in a state to give fixed salaries to directors that are working in the company. In this scenario what do you suggest?
Hi Ed! Thank you for your feedback. Please feel free to check out our channel for more informative videos. Is there anything you would like us to cover?
Interesting well done this brought so much clarity to me .Thank you A quick question so I was a director just holding office being paid with working hours stationed in a permanent building paying taxes. was terminated and now the company is saying i was not a "worker" but a director. I have no contract to prove I was a worker other than payslips TD4 job letter,saying I was an Administrative Manager could these items hold up in court that I was a worker?
@@cindymohammed1647 Whilst we are not experts on employment law outside of the UK, we would suggest that it could be inferred by a court that the words "Basic Wage" mean that you had entered into a contract with your employer.
Very good, detailed answer to the question especially where circumstances can be complex.
Hi Gökhan, thank you for your feedback. We are glad that you have found this video useful! Is there anything else that you would like us to cover for next time?
Genuinely didn't think of this, could have ended up with a nasty surprise down the line. Thank you Nick and 1st Formations
You are welcome, Angus. We are here to help! How many directors do you have in your business?
Another great video as always from the 1st Formations team! Thank you.
Hi Laura! Thank you for your kind feedback. We are always happy to help and answer any questions you have as best we can. Is there anything else you would like us to cover?
Short and to the point, great video!
Hi Bryan! Thank you for your comments. We are glad you found this useful. What did you learn from this video?
Great video! Thank you Nick for this 😊
Hi Jessica! Thank you for your feedback, we will pass this onto Nick. Is there anything else you would like us to cover?
Another great, informative video 1st Formations!! Thank you :)
Thank you, Marianne. What was your main takeaway this week?
Love the detail in this answer! Really helps me to understand
I didn’t know that! I’m glad you explained it really well here, very valuable info 🙌
Hi M.N. Ahmed! Thank you for your feedback. Please feel free to check out the rest of our channel for more guidance and information on the world of company formation. Is there anything, in particular, you would like us to cover?
Very interesting! I love how this video is written, it makes me curious about the topic from the get go
Hi Peter, thank you for your kind comments. We are glad that you have found this interesting. Is there anything else that you would like us to focus on for next time?
Fantastic explanation! Thank you to the 1st Formations Team! 😊
Hi Amelia! Thank you for your feedback. We are always glad to help, is there anything else you would like us to cover?
Great topic and such an often asked question! Well presented video, congrats once more guys keep up the amazing work :)
Hi Kreisi! Thank you for your kind feedback. Did you know the answer before watching this video?
Very helpful, thank you!
Thanks for your kind comment Abbie - is there anything else you would like to see us cover?
Really loving these videos - always straight to the point!
Thank you for your feedback, have you got any questions for us?
Very useful and informative video. Thanks again!
We're pleased you found it useful, Rakhee! Are you the director of a company?
Wow! From what appears at first glance to be a very simple and straightforward topic, it is actually a complex issue as the answer to the question very much depends on circumstances. A very interesting watch - - well done Team 1st Formations! Quick question: if I wanted to create a director's service agreement - who would do this for me?
Hi Graeme! Thank you for your feedback. Yes, absolutely the topic is actually far more complex than it originally seems but we hope we have helped you understand this more thoroughly. A solicitor is a type of lawyer who would be able to assist you in drafting a director's service agreement. Is this something you are looking to do?
@@1stformations Yes, my company is at the stage where I am considering appointing additional directors, so creating directors' service agreements is something that I will need to address. I will take the matter up with my solicitor. Thank you again for your kind advice.
@@graemedonnelly2039 You are very welcome!
This is really useful, thank you for the video. I am considering setting up a company myself and find this information helpful :D
Hi Miles! No problem at all. That is great news. Please feel free to check out our blog pages here for more information regarding company formation: www.1stformations.co.uk/blog/category/company-formation/ What type of business are you looking to set up?
@@1stformations Thank you, it would be for E-commerce purposes. Can you help me with this?
@@mileshogg4918 Hi Miles, yes absolutely! We have an eSeller package that is ideal for ecommerce and dropshipping. For more information, please see our eSeller package here: www.1stformations.co.uk/compare-packages/#eseller Is there anything else we can help you with?
Great video ! really informative :)
We're glad you found this video informative, Mathilda. Is there anything you didn't know about directors before watching this video?
Finally my company secretary explains to me that I am also the employee and the director 😂 🚀🚀🚀
Hi Tommaso! Thank you for your comment. Yes, Nicholas is always happy to help you! Is there anything else that you would like us to cover?
Very useful video, thanks. Is there any legislation governing what should be in a directors' service contract, or can anything be put in it?
You are welcome, John. What a great question. A director's service agreement can have anything you would like within the contract. However, most contracts typically include the basics such as terms of employment, holiday entitlements, duties, benefits, etc. However, if you as the employer wish to include other aspects to the contract, you are more than welcome to do so. Does this help?
Another great video. Q. Can you only describe yourself as a Director within a company if your name appears as such at Companies House?
Hi Adam! Thank you for your comments. Some companies actually give out the job title 'Director' without appointing them officially on Companies House. This is permitted, and so long as they are not actual officers of the company then this does not need to appear on Companies House. What else would you like to know?
@@1stformations Wow - I didn't think that I would get an answer so quick - massively impressed. Cheers for the steer. V impressive!
What if a company (Ltd) only has two directors. They both carry out services for the business ...and derive a net profit at the end. How do you account for their shares? Obviously they dont want to be considered employees, as theres only two of them (say couple 50/50). How do you account in the financial statements what they should get? Through dividends? Or shares? Share holders' equity? Have seen this come up many times and read that when the couple takes funds for themselves after net profit that this should be taxed. Can anyone explain or help?
Thanks for the question. I'm afraid we can't advise from a tax or accounting perspective, nor can we advise from an employment perspective. However, in the first instance we would note that the payment of directors for their services is usually set out in their service agreement with the company. I am assuming that the two directors are also the two shareholders of the company also, in which case they could also be paid in dividends (either instead of, or in combination with, a salary). The actual amount of dividend they receive is dependent on the amount of dividend that is declared (the amount that is declared is usually approved by the shareholders, i.e. a final dividend, or by the directors, also known as an interim dividend). The amount of shares they hold (and structure of the company's share capital) then inform how much of the dividends they themselves will receive. We hope that helps!
Would speaking with an accountant or an HR expert be the best starting place for getting a written service contract drawn up?
Hi Keziah. Yes, speaking with an accountant or a HR expert would be a great place to start to get a written service contract drawn up as they have the knowledge and expertise to get these done for you. What were your thoughts on this week's video? We would love some feedback!
As a Non Resident director how should I pay myself from the company?
Can I set variable salary for directors? Because we are not in a state to give fixed salaries to directors that are working in the company. In this scenario what do you suggest?
ok thanks
Hi Ed! Thank you for your feedback. Please feel free to check out our channel for more informative videos. Is there anything you would like us to cover?
Interesting well done this brought so much clarity to me .Thank you A quick question so I was a director just holding office being paid with working hours stationed in a permanent building paying taxes. was terminated and now the company is saying i was not a "worker" but a director. I have no contract to prove I was a worker other than payslips TD4 job letter,saying I was an Administrative Manager could these items hold up in court that I was a worker?
Was this in the UK or in the USA?
@@1stformations Trinidad and Tobago guided by UK Law
@@cindymohammed1647Do your payslips use the word 'salary'?
@@1stformations Good Morning It has on it "Basic Wage" , " Year to Date" and "Net Income" It also has NIS, Health Surcharge and PAYE deductions
@@cindymohammed1647 Whilst we are not experts on employment law outside of the UK, we would suggest that it could be inferred by a court that the words "Basic Wage" mean that you had entered into a contract with your employer.