Nitin Shah (Proprietor) 26 July 2021

Directors remuneration

My cousin made me Director of his Limited company, promising me a better future for my career. 7 years have passed by,without any difference in my career.in his company. Over this time,h e has not paid me any compensation, as a Director of his company. Though, there is no written agreement, can I claim compensation as a Director for last 7 years, legally?

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Anusha Singh 14 October 2021

As per your query it is understood that you need information regarding the remuneration of director.

The various methods at which company can pay remuneration to its director is below:

In case of Public company, a company can pay not more than 11% of the net profit as calculated in a manner laid down in section 198 of the companies act. Whether it is Managing director or whole time directors.

A company having only one managing director, whole-time director or manager shall not pay more than 5% of its net profits.

A company has more than one such directors, remuneration shall be payable not more than 11% of the net profit.

Yes, you can claim your remuneration from the firm.

Hope it helps!

Regards,

Anusha Singh