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HMRC internal manual

National Insurance Manual

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NIM12002 - Class 1: Calculating Class 1 NICs for Directors: Definition of Director

Regulation 1(2) SSCR 2001

Regulation 1(2) SSCR 2001 defines director to mean:

  1. in relation to a company whose affairs are managed by a board of directors or similar body, a member of that board or similar body;
  2. in relation to a company whose affairs are managed by a single director or similar person, that director or person;
  3. any person in accordance with whose directions or instructions the company’s directors as defined in (a) and (b) above are accustomed to act; and for this purpose a person is not to be treated as such a person by reason only that the directors act on advice given by him in his professional capacity.

Sub-section c includes a person generally known as a ‘shadow director’. Aperson might not be entitled or want to be a named director because of insolvency orcommercial reasons as well as for NICs and tax motives.

But the final part of sub-section c ensures, for example, that a solicitor is not treatedas a director merely because that person is the company’s legal adviser.