Director disqualification proceedings

Company directors who don’t meet their directors’ responsibilities and duties can be disqualified (banned) for up to 15 years.

This means you can’t start, market or run a company or be a director of any UK-registered company or an overseas company with UK interests. Breaching the disqualification terms could also result in a fine or imprisonment.

If you have been reported or are being investigated for being an “unfit” director, our team of commercial lawyers are there to help. You can get advice and support by phoning 01616 966 229 or completing the online enquiry form.

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What is considered unfit conduct for company directors?

The type of activities the law calls “unfit conduct” for company directors includes:

  • Continuing to trade when a company can’t pay debts
  • Failing to keep proper accounting records
  • Not providing accounts and returns to Companies House
  • Not paying corporation tax
  • Using company funds for personal use

Automatic disqualification happens if you’re declared bankrupt, given a debt relief order or subject to bankruptcy or debt relief restrictions. And you can be prosecuted for conducting business on the instruction of a disqualified person.

What else happens after a company director is disqualified?

  • Your details are published online in the Companies House database of disqualified directors
  • Your disqualification and the reasons why are published on The Insolvency Service’s register
  • You are disallowed from holding other positions of responsibility such as:
    • Being on the board of a charity, school or police authority
    • Being a Partner in a Limited Liability Partnership
    • Being a pension trustee
    • Being a registered social landlord
    • Sitting on a health board or social care organisation
    • Being a solicitor, barrister or accountant

Our insolvency and business recovery solicitors are experts when it comes to advising directors of distressed and insolvent businesses of their duties and obligations. We can offer business directors professional, impartial advice about how to manage insolvency and ensure they meet all of their director duties during the ongoing insolvency process.

If you would like to know more about your legal obligations as a company director, and how Stephensons can help if your business is distressed or operating in insolvency, call us today on 01616 966 229.

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