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Sporadic dividends

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    Sporadic dividends

    I know there is no general rule when it comes to dividends, some people pay every month, some pay every year, but is there something to be said to having regular dividends?

    In the past I have tried to keep it to every quarter, because if you can't forecast your general finances for the next three months you really shouldn't be running a business, but in life things are never that simple so occasionally I will take a sporadic extra (call it a "special") dividend, or move the dates a few weeks of the next planned one.
    Contracting is like plumbing. You're your own boss until you walk into someone's house and they tell you to take your shoes off.

    #2
    There is no general rule.....
    'CUK forum personality of 2011 - Winner - Yes really!!!!

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      #3
      Originally posted by InsertWittyNameHere555 View Post
      I know there is no general rule

      <snip>
      Originally posted by northernladuk View Post
      There is no general rule.....
      Thank you for that insight
      Contracting is like plumbing. You're your own boss until you walk into someone's house and they tell you to take your shoes off.

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        #4
        Originally posted by InsertWittyNameHere555 View Post
        is there something to be said to having regular dividends?
        The interval between successive payments is roughly equal.

        Comment


          #5
          Originally posted by InsertWittyNameHere555 View Post
          I know there is no general rule when it comes to dividends, some people pay every month, some pay every year, but is there something to be said to having regular dividends?

          In the past I have tried to keep it to every quarter, because if you can't forecast your general finances for the next three months you really shouldn't be running a business, but in life things are never that simple so occasionally I will take a sporadic extra (call it a "special") dividend, or move the dates a few weeks of the next planned one.
          As NLUK and you both say - there is no general rule.

          Previously, it was always a thought that regular dividends could be seen as effectively you having a salary and therefore it could potentially be subject to NIC. However we are talking years ago...

          As the rules have now changed in regards to dividends and they are now taxed in the BRB, I can't see this ever coming into play.

          We're all ears!

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            #6
            If you can't work out when the best time to pay dividends based on the facts of your business you shouldn't be running one either surely.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              There are no rules.

              There are some theories...whether there's any truth to them or not is another matter. Eg as Louise said, I've heard a few accountants warn against making a consistent monthly dividend as it could be argued that it's salary. I've seen no evidence of this.

              There's also the argument around dividend paperwork. Ie if you do one £40k dividend a year, that's one bit of paperwork. If you do 40 x £1k dividends a year, that's 40 bits of paperwork. Yes many micro company owners won't bother with the paperwork and won't suffer any negative impact of it.

              So in practice, you can most likely do whatever you like in terms of frequency/consistency and be fine.

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                #8
                Originally posted by Maslins View Post
                There are no rules.
                This isn't, 'Nam.

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                  #9
                  I suggest you pay dividends whenever the missus is going shopping.

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                    #10
                    I declare a small dividend every morning to cover the cost of my morning coffee and newspaper.

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