What are the differences between Directors, Shareholders & Employees?

In our brief guide we'll talk through the differences between shareholders, directors and employees.

By Chris Andreou

Updated:

February 2, 2024

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What are the differences between Directors, Shareholders & Employees guide
What are the differences between Directors, Shareholders & Employees guide

Directors

  • Directors have the responsibility of running and managing a Limited company;
  • Directors are responsible for ensuring all company accounts are filed with HMRC and Companies House;
  • Directors must have board meetings to decide on company activities – including taking a dividend.

Shareholders

  • Shareholders are not involved in the running and managing of the Limited company;
  • Shareholders are involved in some decisions, like the change of company name, however not day to day running;
  • Shareholders are entitled to take dividends from the company, as long as these can be justified from their role in the company.

Employees

  • Employees work for the Limited company and are employed. They will receive a monthly salary from the Limited company.
  • They are not part of any decision making process and do not have any rights to dividends.

Read more Limited Company guides