A director of a residents' management company has the same duties as any company director: act within the articles, in good faith for the members, with reasonable care, and avoid conflicts. The company must file a confirmation statement and its own accounts at Companies House every year, and is usually the responsible person for fire safety in the common parts. Directors are not normally personally liable for the company's debts if they act properly.
01What the role is
A residents' management company, or RMC, is an ordinary limited company, so its directors have the same duties as any company director. Most are leaseholders who volunteer, unpaid, to run the building for everyone. The company's articles usually say who can be a director, often only members, and how many there must be; the law needs at least one, and at least one must be a real person.
02Your duties in company law
The Companies Act 2006 sets seven general duties. In plain terms: act within the company's articles, act in good faith for the members as a whole, use your own judgement, take reasonable care, avoid conflicts of interest, do not take benefits from third parties such as contractors, and declare any interest you have in a proposed arrangement. A director who owns a flat in the building is not conflicted just by owning it, but should declare any personal interest in a particular decision.
03What has to be filed
- Confirmation statement at Companies House every year.
- The company's own annual accounts at Companies House, usually small or dormant company accounts. These are separate from the service charge accounts, which are not filed there.
- Changes: a new or departing director, or a new registered office, notified within 14 days.
- Identity verification: since 18 November 2025 new directors must verify their identity with Companies House, and existing directors by the time of the company's next confirmation statement.
A private company no longer has to have a company secretary, but many RMCs ask their managing agent to do the secretarial work. Ours is included in the fee.
04The building
The lease sets what the company must do: usually repair and maintain the structure and shared parts, insure the building, and collect the service charge to pay for it. The company is normally the responsible person for fire safety in the common parts, which in practice means the directors must make sure a fire risk assessment is in place and acted on. Service charge money is held on trust for the leaseholders, separately from the company's own money.
05Personal liability
Because the company is limited, directors are not normally personally liable for its debts or decisions taken properly. The exceptions are a breach of your duties, knowingly letting the company trade while insolvent, and criminal offences such as serious failures under fire safety law. That is why most boards keep directors' and officers' insurance, and why decisions should be taken at a meeting and minuted.
06What a managing agent takes off you
The day to day: budgets and demands, chasing arrears, contractors and repairs, the fire risk assessment and safety checks, insurance renewal, the accounts, and the Companies House filings. The board keeps the decisions. We send directors a written report each quarter and every document sits in Servanda, our software, where any director can see it.
07Questions
What are the responsibilities of a director of a residents management company?
To run the company properly for all the members: keep within the articles, act in good faith, take reasonable care, avoid conflicts, make sure the lease obligations are met (repairs, insurance, the service charge), make sure fire safety in the common parts is managed, and make sure the Companies House filings are made on time.
Can a director of an RMC be held personally liable?
Not normally for the company's debts or for decisions taken properly, because the company is limited. Liability can arise for a breach of a director's duties, for letting the company trade while insolvent, or for criminal offences such as serious fire safety failures, which is why boards keep directors' and officers' insurance.
How many directors does a residents management company need?
The law requires at least one director, at least one of them a real person. The company's articles may require more, and most boards have two or three so decisions can be shared and the company keeps running when someone sells.
Does an RMC need a company secretary?
No. Since 2008 a private company does not have to appoint one. Many RMCs ask their managing agent to do the secretarial work instead; ours is included in the fee.
How do I resign as a director of a residents management company?
Write to the company saying you are resigning and from what date. The company then tells Companies House within 14 days. Check the articles first: if you are the only director, someone else must be appointed or the company is left without one.
Does a residents management company have to hold an AGM?
Not by law. Since the Companies Act 2006 a private company does not have to hold an annual general meeting unless its articles say so, and many RMC articles still do. Even where it is not required, a yearly meeting to present the accounts and budget and elect directors is good practice.
Can a residents management company own the freehold?
Yes. Many RMCs own the freehold of their building or estate, often transferred by the developer or bought by the leaseholders, with each flat owner a member. Others only manage under the lease while someone else owns the freehold. The company's title and the leases say which.
Do RMC directors get paid?
Usually not. Most are leaseholders who volunteer. The articles may allow payment or expenses, but paying a director from the service charge is rarely permitted by the lease.
08Guides for directors
- Service charge estimate
- RICS regulated block managers in Essex
- The reserve fund
- Service charge arrears
- Service charge accounts
- Directors' duties in an RMC
- How to choose a managing agent
- A free service charge check
- Service charges explained
- Buildings insurance for blocks
- Fire safety in blocks of flats
- The Directors' Library
- What is block management?
- How to change managing agent
- Residents' management companies
- Right to manage
- Block management fees
- Section 20 major works
- New-build estate fees
- Estate management in Essex