Changing shareholdings and dividends

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ASB replied

26 November 2016, 21:44
Vm,

Was your origanal question "i am not sure how to deal with it" or was it "i would like to make different payments". The former you have the answer to. The latter is possible if you have a substantial attitude to risk.
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northernladuk replied

25 November 2016, 11:54
It is kind of a contracting question as the same will apply if you change your LTD shareholding as well.
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Lance replied

25 November 2016, 11:17
Originally posted by VectraMan View Post

A general not really contracting question if anyone wants to indulge (and naturally I don't have an accountant).

Normally dividends are paid in proportion to shareholding of course, but what happens if that changes in the middle of the year? E.g. someone takes on a 50% share 6 months through the company year, and a final dividend is paid at the end of the year. Do they get 50%? Or is it normal to calculate it pro-rata (i.e. they get 25% and the other shareholder gets 75%).

It is calculated by shareholding, at dividend issue.
EG. 1st Jan with person A having 100%. Person A gets 100% of the dividend.
Shares changed at 1st Feb to 50/50 spilt. Dividend issue at 1st March will be 50/50.

Forget pro-rata. It's who owns them at issue time.
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ASB replied

25 November 2016, 10:33
It is paid pro-rate by share class. So if they own 50% shares at the date of dividend declaration they get 50% of the dividends.

You could always use different share classes (with accompanying risks of settlements etc of course), or declare dividend before the transfer. If you don't have the physical funds then journalise to the shareholderts current account.
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VectraMan started a topic Changing shareholdings and dividends

25 November 2016, 10:19
Changing shareholdings and dividends

A general not really contracting question if anyone wants to indulge (and naturally I don't have an accountant).

Normally dividends are paid in proportion to shareholding of course, but what happens if that changes in the middle of the year? E.g. someone takes on a 50% share 6 months through the company year, and a final dividend is paid at the end of the year. Do they get 50%? Or is it normal to calculate it pro-rata (i.e. they get 25% and the other shareholder gets 75%).

And how do interim dividends fit in?

Thanks for any advises.
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