Dividend question

[XLMonkey]

Presumably from a personal tax point of view it's when the money was paid that counts, not when the dividend was declared.

I suppose if nobody ever looked at the bank accounts, you'd get away with it. And if not, well at least you get free accomodation and meals whilst serving your time.

Strictly, its when the dividend is declared and available to the shareholder that it becomes part of your personal income (and tax return). It doesn't matter whether or not you actually receive the money till later.

However, with that said, the time gap is pretty big between the dividend date on your "discovered" paperwork and the actual date of transfer of the money from yourco to you. You might find it difficult to explain to Hector why you left so much of your money sitting in the company account for the thick end of a year....

I think you need to chalk it up to experience and take more care next time.

[IR35 Avoider]

I think I read somewhere about a case of a guy (not a contractor) who backdated dividends - he was sentenced to something like two years inside.

[VectraMan]

Presumably from a personal tax point of view it's when the money was paid that counts, not when the dividend was declared.

I suppose if nobody ever looked at the bank accounts, you'd get away with it. And if not, well at least you get free accomodation and meals whilst serving your time.

[Harrysp]

Amazingly I have just discovered I have declared dividends for 2005/06 and the paper work was at the bottom of my cabinet. Silly me. However if the cash didnt leave the companys account till now for example, surley the powers to be would take a dim view of it all.....???

TIA

[ASB]

Beiung the numpty that I am I have just realised I only declared 18.5k of divis for the finiancial year 2005-6. I was drawing a salary of 9.5k, can I declare dividends for that finiancial year, just so that I can use up my allowance? or is now to late??

TIA

It's occasionally possible to discover the payment was made pre april '06. Normally th minutes turn up in the bottom of the filing cabinet.

Of course if you've actually file either corporate or personal returns it might not be a good idea to discover them.

[Gonzo]

He's talking about 05/06. In other words, ran out 5th April 2006.

Sh1t - is it nearly 2007 already? I obviously didn't read it properly

[VectraMan]

Assuming that you are in the UK then your personal allowance (by which I assume you mean paying yourself the maximum below the 40% tax bracket) runs until 5th April so you still have time.

He's talking about 05/06. In other words, ran out 5th April 2006.

[Gonzo]

Beiung the numpty that I am I have just realised I only declared 18.5k of divis for the finiancial year 2005-6. I was drawing a salary of 9.5k, can I declare dividends for that finiancial year, just so that I can use up my allowance? or is now to late??

TIA

What allowance?

Assuming that you are in the UK then your personal allowance (by which I assume you mean paying yourself the maximum below the 40% tax bracket) runs until 5th April so you still have time.

If you mean that your company financial year has now ended I don't see that there is an "allowance". Dividends are paid out of profits - if you mean that you have "retained profits" from the last company financial year because you didn't pay them out as divis, then I do not see why these cannot be paid out as divis in the following financial year - provided that they are paid from profits that the company has made. A large plc would not declare a final dividend until long after the financial year has ended.

Usual disclaimer, IANAC etc etc.

[Harrysp]

Yep, wanted to declare dividend now to count as part of last years income stream. Ah well serves me right, but I will double check this with my accountants when they get back in from their xmas break

[VectraMan]

You want to declare divs you took last year in this years allowance....

I think he wants to declare divs based on last years profits (which I guess is okay), but have that count as last year's income not this year's (which is not). But IANAA.

[Sockpuppet]

Explain...

You want to declare divs you took last year in this years allowance....

If so thats not possible and expect hector to come down on you as a ton o tulipe.

[Harrysp]

Beiung the numpty that I am I have just realised I only declared 18.5k of divis for the finiancial year 2005-6. I was drawing a salary of 9.5k, can I declare dividends for that finiancial year, just so that I can use up my allowance? or is now to late??

TIA