Making my wife a Director

Didn't find your answer?

Our Limited company was formed in 1998 and I was appointed the role of Director and my wife that of Company Secretary.  We each own 50% shares in the company.  This has worked well for 26 years and we have no issues with this setup.  As an IT company I provide the service and my wife looks after all the admin.

We are now considering taking a company car lease of an EV and in order to insure it privately under my wifes name it would appear she needs to be a director of the company.

I believe their are two options to changing her role in the company:

1. Remove her Company Secretary role and add a Director role.

2. Add a Director role.

I'm assuming it is possible for a person to be assigned two different roles in a company on companies house?  If not then option 2 would be the only way forward.

Are there any advantages/disadvantages of my wife's role changing to Director and removing the Company Secretary role?

Thanks.

Replies (22)

Please login or register to join the discussion.

avatar
By Truthsayer
14th Jun 2024 09:49

Nobody cares about the role of company secretary. For private companies it is an unnecessary irrelevance, so she can be a director with or without being the secretary as well, unless there is some special circumstance in your case: which there might possibly be, so why aren't you asking your accountant or solicitor?

Thanks (0)
Replying to Truthsayer:
avatar
By David Ex
14th Jun 2024 09:54

Truthsayer wrote:

… so why aren't you asking your accountant or solicitor?

The OP works in IT ….

Thanks (6)
Replying to David Ex:
avatar
By FactChecker
14th Jun 2024 14:03

... no ssh IT!

Thanks (5)
avatar
By milleniumaire
14th Jun 2024 09:54

My accountant has advised she should become a director and I will accept that advice. This question is more about the best way to do that; keep her existing role or replace it.

Thanks (0)
Replying to milleniumaire:
Stepurhan
By stepurhan
14th Jun 2024 10:02

Did your accountant not advise on that at the same time? Any reason you are asking us instead of him?

Thanks (4)
Replying to milleniumaire:
avatar
By David Ex
14th Jun 2024 10:11

milleniumaire wrote:

My accountant has advised she should become a director and I will accept that advice. This question is more about the best way to do that; keep her existing role or replace it.

Practising accountants charge for their professional advice. I’m guessing that’s a similar model to the one your IT business operates.

Thanks (3)
Replying to milleniumaire:
avatar
By bettybobbymeggie
14th Jun 2024 10:23

milleniumaire wrote:
keep her existing role or replace it

It doesn't matter - she can be appointed as a director and remain as secretary or you can terminate her appointment as secretary.

Thanks (0)
avatar
By Paul Crowley
14th Jun 2024 10:24

Trust in the accountant you have, or consider whether he is the correct person you.

Thanks (3)
avatar
By Tax Dragon
14th Jun 2024 11:13

No need to resign as secretary to become a director. Makes no tax or accounting difference. For any legal consequences - wrong forum.

Does the insurer know it's a company car? Justin might say it doesn't matter what you do or don't tell the insurer, but I wouldn't take the risk. And that's without considering the 2017 Regs, which might remove any choice in the matter.

Thanks (0)
Replying to Tax Dragon:
avatar
By milleniumaire
14th Jun 2024 11:17

bettybobbymeggie wrote:

milleniumaire wrote: keep her existing role or replace it

It doesn't matter - she can be appointed as a director and remain as secretary or you can terminate her appointment as secretary.

Tax Dragon wrote:

No need to resign as secretary to become a director. Makes no tax or accounting difference. For any legal consequences - wrong forum.

Does the insurer know it's a company car? Justin might say it doesn't matter what you do or don't tell the insurer, but I wouldn't take the risk. And that's without considering the 2017 Regs, which might remove any choice in the matter.

Thank you for the feedback. I didn't think it would matter, but thought I should ask. After 26 years, my wife likes her Company Secretary title/role, so I will just add Director and she can then chose which to use!

Thanks (0)
Replying to milleniumaire:
avatar
By David Ex
14th Jun 2024 12:14

milleniumaire wrote:

, so I will just add Director and she can then chose which to use!

If you think an appointment as company director is all about company cars and “fancy” titles, you’d do well to familiarise yourself with the legal obligations associated with the role.

Thanks (3)
Replying to milleniumaire:
avatar
By FactChecker
14th Jun 2024 14:12

"my wife likes her Company Secretary title/role"
... enough to compensate her for all those personal penalties if anything (supposedly filed by her) is found to be incorrect at CH?

Maybe she'd like to try Panjandrum on for size, or Galactic Overseer Demagogue?

Thanks (2)
Replying to Tax Dragon:
avatar
By milleniumaire
14th Jun 2024 11:22

Tax Dragon wrote:

No need to resign as secretary to become a director. Makes no tax or accounting difference. For any legal consequences - wrong forum.

Does the insurer know it's a company car? Justin might say it doesn't matter what you do or don't tell the insurer, but I wouldn't take the risk. And that's without considering the 2017 Regs, which might remove any choice in the matter.

The one quote we have had so far was a personal quote and it asks who owns the car and if it is a company car, so we answered the question honestly. It would appear that this question covered the issue, but before purchasing any policy I will be contacting the insurer just to be 100% sure there isn't an issue.

Based on a group of fellow contractors, they all have personal insurance policies for their company car leases so it appears to be something that is done frequently, however they are all directors of their company's.

Thanks (0)
Replying to milleniumaire:
RLI
By lionofludesch
14th Jun 2024 12:19

milleniumaire wrote:

Based on a group of fellow contractors, they all have personal insurance policies for their company car leases so it appears to be something that is done frequently, however they are all directors of their company's.

Whether or not this is grand is a legal question and few on here would think themselves qualified to give a definitive answer. Like many before you, you need a lawyer but have sought an accountant.

Thanks (0)
the sea otter
By memyself-eye
14th Jun 2024 13:05

My brother was a lawyer in Brum - a brick lawyer.
He works in 'IT' now.
Just saying....

Thanks (0)
DougScott
By Dougscott
14th Jun 2024 13:25

If you want the car to be a company car and also claim the costs of running the car through the company then everything should be in the name of the company and invoiced to the company and paid by the company in my view. I have certainly made sure I have done that with my company electric car. I got my insurance through LV which allows for the insurance to be in the name of the main driver but shows the interest of the company as owner. The company also pays the insurance. If you haven't already got a home charger bear in mind your company can get a £350 grant towards installing one (by an approved installer) by filling in a simple on-line form.

Thanks (0)
Replying to Dougscott:
avatar
By milleniumaire
14th Jun 2024 14:02

Dougscott wrote:

If you want the car to be a company car and also claim the costs of running the car through the company then everything should be in the name of the company and invoiced to the company and paid by the company in my view. I have certainly made sure I have done that with my company electric car. I got my insurance through LV which allows for the insurance to be in the name of the main driver but shows the interest of the company as owner. The company also pays the insurance. If you haven't already got a home charger bear in mind your company can get a £350 grant towards installing one (by an approved installer) by filling in a simple on-line form.

Thanks for the info. I am aware of the £350 grant as most installers are quoting prices minus the grant, but my understanding is that it is the business owner that must apply for the grant, not the installer, but this is something I will investigate further down the line as we still haven't made a decision about how the EV will be purchased/leased.

Is your LV insurance policy defined as a "business" policy or is it simply that the company name is mentioned? My wife's current insurer is LV, so she was planning to contact them to discuss how the insurance for a company lease would be best purchased. I like the idea that there can be a named driver and assume this therefore means that drivers NCD can be used, even though it is a "business" policy. Sounds like a win win situation.

Thanks (0)
Replying to milleniumaire:
DougScott
By Dougscott
14th Jun 2024 14:07

Yes, it has to cover use for business use otherwise it wouldn't be a company car would it, or at the very least the insurance would be invalid! Also bear in mind whether you are going for a company lease PURCHASE in which case 100% FYA can be claimed (if its a brand new car) or whether its lease hire = cost of hire as incurred claimed.

Thanks (0)
Replying to Dougscott:
avatar
By milleniumaire
14th Jun 2024 14:22

The car will not be used for ANY business use or commuting, but it is still a "company car" as the company will be leasing it and paying for that lease, then handing it back when the lease expires. At no point will the company own the car.
I guess it depends on the definition of "company car". In this case, the company nor my wife will own the car, but the company is making the lease payments and claiming 50% VAT due to it being used for personal use. My wife will pay the BIK as the car is a benefit.
At the end of the day as long as the Lease company are happy with the insurance arrangement and the insurance company are happy to insure, I don't think labels like "company car", "personal insurance", "business insurance" really matter. What matters is the car is legally insured to be driven by my wife and the insurance policy accurately reflects who is driving the car, who owns the car and probably, who has an interest in the car.
Whether the company pays the insurance premiums or the director pays the premiums and claims them back from the company, I'm not sure this is relevant, but I'm sure someone on this forum will shoot me down and correct me.

Thanks (0)
Replying to milleniumaire:
avatar
By FactChecker
14th Jun 2024 14:53

"I don't think labels like "company car" .. really matter."

Like so many things, whether something matters depends on the context - which is why I'd expect your accountant (with experience in all those aspects) to provide the best all-round advice.

FWIW - no idea whether it matters to you, but whether the vehicle is deemed to be a 'company car' or the 'employee's car' has quite a marked difference on your options for reimbursing mileage (and taxability thereof). That's just one example.

Thanks (3)
Replying to FactChecker:
avatar
By milleniumaire
14th Jun 2024 15:33

In respect of the labels, I'm only talking about car insurance.

There will be no mileage reimbursements as the mileage will all be private.

My accountant is aware of my plans and agrees with them. This post was all about company roles and I asked the question here as I didn't want to bother him with the minutiae of how we would change my wife's role in the company, but seems to have veered into car insurance, which is fine by me as all advice is most welcomed.

Thanks (0)
avatar
By zebaa
14th Jun 2024 17:12

Just be aware that an Insurance company may regard your limited company and your wife as separate entities. This is not a problem until your wife wants insurance in her name and finds the no-claim-discount does not carry over from the limited company.

Thanks (0)