Reply to: Advice on dividends

[NotAllThere]

That could be because it's so basic you can find it with a 30 second search on google? It could be that your poor attitude is the reason why no one did it for you and we don't need it for our information. ...

Exactly. Laziness (or appearing to be lazy by not mentioning the research you've done, or phrasing yourself badly) wins no friends.

Anyway. All done now. Thread locked.

[MrMarkyMark]

Anyway I'm done. I KNOW EVERYTHING NOW.

Hope you've all learnt something tonight guys, cheers.

Actually I have, they say any idiot can run a LTD company, you have proved an exception to that rule.

Cheers

[northernladuk]

Oh I'm sure you'll be back very soon

[genius]

Fred's on ignore now - thanks for the advice Fred. So yeah maybe I'll stick around. And as I say, I know everything I need now about dividends so hopefully won't have to speak to any of you lot again for a while.

[mudskipper]

You say that but I bet you didn't know minutes aren't compulsory and unless an actual meeting with YOURSELF took place, are not required.

Anyway I'm done. I KNOW EVERYTHING NOW.

Hope you've all learnt something tonight guys, cheers.

Your accountant should be telling you this stuff. Mine gives me dividend vouchers to fill in and submit back to them.

If your accountant isn't a contractor specialist, and you don't feel they're up to speed, consider switching to one who's doing this day in, day out - could save you a lot of grief in the long run.

[jamesbrown]

I've got to say I've frequented many forums over the years for various different things but never have I experienced an attitude, resistance and smugness that I have on here - a forum for contractors. It really is a pretty horrific community you've made for yourselves.

You don't have to be a dick just because you earn a lot of money... remember that guys.

Cheers

P.S. when is the next social meet?

Actually, most people get along fine. Remember that all of us are offering our time, free of charge, to help new posters. Some are more abrasive than others There's limited tolerance when a new poster has done very limited research and asks basic questions for which the answers are readily available, if they'd bothered to search in advance. Typically, these questions allude to a more fundamental lack of understanding about contracting. Read the guides, don't be so thin-skinned, and stick around. Ultimately, you'll find a huge amount of useful information and many knowledgeable posters here, including accountants and specialists, all of whom are willing to help posters that are willing to help themselves.

[Fred Bloggs]

An ignore function is badly needed here. Maybe there is one already.......

Yes there is. Why didn't I look before now? That's better.

[Fred Bloggs]

I've got to say I've frequented many forums over the years for various different things but never have I experienced an attitude, resistance and smugness that I have on here - a forum for contractors. It really is a pretty horrific community you've made for yourselves.

You don't have to be a dick just because you earn a lot of money... remember that guys.

Cheers

P.S. when is the next social meet?

An ignore function is badly needed here. Maybe there is one already.......

[genius]

I've got to say I've frequented many forums over the years for various different things but never have I experienced an attitude, resistance and smugness that I have on here - a forum for contractors. It really is a pretty horrific community you've made for yourselves.

You don't have to be a dick just because you earn a lot of money... remember that guys.

Cheers

P.S. when is the next social meet?

[stek]

You say that but I bet you didn't know minutes aren't compulsory and unless an actual meeting with YOURSELF took place, are not required.

Anyway I'm done. I KNOW EVERYTHING NOW.

Hope you've all learnt something tonight guys, cheers.

WRT to your username; was 'remtard' taken?

[northernladuk]

Also I found an answer to my initial question which no one here could confirm for me. Here it is for your own information.

That could be because it's so basic you can find it with a 30 second search on google? It could be that your poor attitude is the reason why no one did it for you and we don't need it for our information. We know.

I hope your ability to go find the absolute fundamentals of what you do get better and your not going ask every basic question on here. People help for free bit will tire very quickly.

[genius]

You say that but I bet you didn't know minutes aren't compulsory and unless an actual meeting with YOURSELF took place, are not required.

Anyway I'm done. I KNOW EVERYTHING NOW.

Hope you've all learnt something tonight guys, cheers.

[SueEllen]

Hopefully someone else will come along to spoon feed you shortly...

[genius]

From the HMRC web site:

To pay a dividend, you must:

hold a directors’ meeting to ‘declare’ the dividend
keep minutes of the meeting, even if you’re the only director

Dividend paperwork

For each dividend payment the company makes, you must write up a dividend voucher showing the:

date
company name
names of the shareholders being paid a dividend
amount of the dividend
the amount of the ‘dividend tax credit’


Few questions on this. Does everyone on here really hold a meeting with themselves and take minutes? And also, the mention of 'tax credits' on the voucher - I assume this is no longer relevant for this tax year.


Also I found an answer to my initial question which no one here could confirm for me. Here it is for your own information. If it's good enough for Paul Scholes, it's good enough for me.

“A company may only make a distribution out of profits available for the purpose”. A dividend can only be paid if there are sufficient distributable profits out of which the payment can be made. If a dividend is paid that proves to be in excess of this profit or if made out of capital or even made when there are losses that exceed the accumulated profits then this is termed ‘ultra vires’ and is, in effect, ‘illegal’.

"Therefore the financial status of the company needs to be considered each time a dividend payment is made which can prove difficult with the payment of interim dividends unless the company is VAT registered and the accountant does the VAT return calculations. Unusually HMRC appears to appreciate the problem, the Corporation Tax Manual 20095 (17) states that accounts only need to be detailed enough to enable “a reasonable judgement to be made as to the amount of the distributable profits” as at the date of payment.

If the directors correctly prepare basic interim accounts and a dividend is paid on the basis of those accounts then that will be deemed lawful, even if, when the final annual accounts, prepared at a later date, show that at the time there was an insufficient amount available as for distributable profits.

s Paul Scholes said under the question headed Interim Dividends:“It is actually so easy to do and you can scribble on a piece of scrap paper, turnover, less expenses, less 21% to give you available for divs, so, given the risks of not doing it, why would you not do so?"

[genius]

Yes I have read of the changes to dividend taxes starting this month.

I'm not sure what personal tax obligations I will have - unless dividend tax is considered personal. My PAYE salary won't be high enough for tax.