Set Up A Limited Company in 2024: How much does it cost to appoint a company director?

When you’re expanding your business or simply restructuring, adding a new director to your company can be a significant step. It brings fresh ideas, new leadership, and potentially opens up new networks and opportunities. 

However, one of the first questions that come to mind is, “How much will it cost?” Understanding the financial implications is crucial for budgeting and planning. In this article, we’ll explore the costs associated with adding a director to your company in the UK.

Direct Costs of Adding a Director

Companies House Filing Fees

The good news is that adding a director to your company through Companies House is generally cost-free if done online. The official WebFiling service allows you to submit the AP01 form (Appointment of a Director) without any charge. 

For those preferring traditional methods, submitting the form via post might incur minimal costs related to postage, as the filing itself is free. Check out the Companies House fees here.

Online vs. Postal Filing

While the direct filing costs are minimal or non-existent, the choice between online and postal submissions can impact how quickly the appointment is processed. Online submissions are not only free but are also processed faster, making them the preferred option for most businesses.

Professional Fees

Not everyone feels at ease handling the intricacies of appointing a new director by themselves, given the legal and regulatory complexities involved. This discomfort often leads companies to seek external expertise, introducing the necessity for professional fees.

These fees are paid to legal advisors, accountants, or company formation agents who offer their specialized knowledge and services to ensure the appointment process is conducted correctly and efficiently. 

By engaging professionals, companies can navigate the bureaucratic and legal maze with confidence, making sure that every step from paperwork to compliance is meticulously managed.

This approach not only saves time but also safeguards against potential errors or legal issues that could arise from a misstep in the appointment process.

Accountant and Legal Advisor Fees

Hiring an advisor, accountant, finance director or legal advisor to manage the appointment can add to the cost. These professionals provide valuable services, ensuring that the appointment complies with all legal requirements and is executed smoothly. 

Their fees can vary widely, from a few hundred to several thousand pounds, depending on the complexity of your situation and the reputation of the professional.

Company Formation Agent Fees

For businesses that prefer a one-stop solution, company formation agents offer packages that include director appointments. These services can be cost-effective, especially for new businesses setting up their corporate structure. However, costs vary based on the level of service and additional support provided.

Additional Considerations and Costs

While the direct costs associated with adding a director to a company, such as filing fees with Companies House, are relatively straightforward and often minimal, the overall process entails several additional considerations that can indirectly influence the financial outlay. These indirect costs stem from various aspects of the appointment process and the ongoing responsibilities that come with a new director.

Administrative Costs

The administration involved in updating company records, issuing new share certificates (if applicable), and other internal paperwork can require staff time and resources.

Potential Hidden Costs

Consider the long-term costs associated with having an additional director, such as increased remuneration, benefits, insurance, and potentially higher professional fees for audits and compliance.

Related reading: How do I find a company director UK?


Adding a director to your company is a relatively low-cost process in terms of direct expenses, especially if you opt to complete the application online through Companies House. 

However, professional fees for legal or financial advice can add to the overall costs, depending on your company’s needs and the complexity of the appointment. It’s important to weigh these costs against the potential benefits a new director can bring to your business, ensuring that your decision aligns with your strategic goals and budget.

Written by: John Courtney

John is highly ranked in the Top 100 UK Entrepreneurs list by City AM and is winner of the Lifetime Achievement Award from techSPARK. He has been a Board Director himself for over 40 years and first started placing Non-Executive Directors over 25 years ago. John founded and ran seven of his own businesses including a Management Consultancy for 10 years, a Corporate Finance offering for 10 years and a mid-sized Digital Agency for another 10 years.