Set up and manage company directors in QuickBooks Online Payroll

Learn how to add or remove a company director in your payroll.

In QuickBooks Online Payroll, directors are set up as employees. Their National Insurance Contributions (NICs) are worked out on their annual income, rather than their monthly or weekly pay.

Add a company director

To add a company director, follow these steps:

1. Go to All apps , select Payroll, then select Employees (Take me there).
2. Add an employee or select an existing one.
3. Go to Tax information and click Edit or Start.
4. Tick the Company director checkbox. 
5. Add their Appointment date.
6. Select the Director calculation method:
   • Annual – for irregular payments (e.g., largely bonuses). Note: cannot be changed during the tax year once payments begin.
   • Alternative – for regular salaried payments.
7. Save to apply changes.

Remove a company director

If the director is leaving:

• Issue and provide the P45.
• After final payment, delete the director's NIC calculation method in the Full Payment Submission (FPS) and notify HMRC.
• Deduct any outstanding NICs from their final pay.

If the director stays on as a regular employee:

1. Go to All apps , select Payroll, then select Employees (Take me there).
2. Select the employee and open Tax information.
3. Untick Company director checkbox.
4. Save to apply changes.

Note: The director continues to be treated as such for NIC calculation until the end of the current tax year—which ends on 6 April.

What's next?

Looking for guidance on navigating QuickBooks Online Payroll? Check out this resource page with how-to guides to help you.