Reply to: Paying out Div`s- Timings

[SueEllen]

Absolutely right there isn't but when the OP posts something like the comments in the thread below you wonder how badly he is running things. If he can't work out what is a director and what is a shareholder it signals to me that the reasons for giving this sharesholders may, yes be legal, but fail on common sense issues so exposing him should he be investigated.

I suppose he's been given advice before but has refused to take it.

However in his case I would:
1. Have a read of business link
2. Get a good accountant - I know other family businesses with children who are 16+ where the parents use their child's tax allowance. However the child actually has to do some work for the business, which they actually do. (I have had to listen to some of the teenagers moaning.)

[northernladuk]

There isn't a rule on shareholders is there? So if you wish to have all your family as shareholders in your business you can particularly if they have given you money for the business.

Though trying to pay them at different times when you all own the same class of share is suspect.

Absolutely right there isn't but when the OP posts something like the comments in the thread below you wonder how badly he is running things. If he can't work out what is a director and what is a shareholder it signals to me that the reasons for giving this sharesholders may, yes be legal, but fail on common sense issues so exposing him should he be investigated.

http://forums.contractoruk.com/accou...-year-end.html

Sorry to jump in . Is a director loan per person? I have 4 x shareholders - of which one is a director and 1 x is the company sec- the other two shareholder do not hold any position. Can my company have four directors loan at £6k each ?

I know but I thought the work Director may be extended to shareholder in some circumstances. Does a Company Sec. count as a director with re to Loans?

[SueEllen]

Why do you have 4 shareholders? Are you sure it all looks above board should you be investigated or have you just dished them out ot your family to keep your tax liabilities to a minimum?

There isn't a rule on shareholders is there? So if you wish to have all your family as shareholders in your business you can particularly if they have given you money for the business.

Though trying to pay them at different times when you all own the same class of share is suspect.

[JamJarST]

Bearing in mind the OP's questions in other threads about what is a director and what is a shareholder I seriously think the OP is just running wild with this without truly understanding what he is doing and the implications of it going wrong.

Yeah I don't want to jump to conclusions but I suspect when we get down to the nitty gritty of this we will find that this is an attempt to evade tax.

[northernladuk]

That is what I was asking too.

Bearing in mind the OP's questions in other threads about what is a director and what is a shareholder I seriously think the OP is just running wild with this without truly understanding what he is doing and the implications of it going wrong.

[JamJarST]

Why do you have 4 shareholders? Are you sure it all looks above board should you be investigated or have you just dished them out ot your family to keep your tax liabilities to a minimum?

That is what I was asking too.

[northernladuk]

Why do you have 4 shareholders? Are you sure it all looks above board should you be investigated or have you just dished them out ot your family to keep your tax liabilities to a minimum?

[SueEllen]

If I have to declare the DIV`s at the same time, can I withhold the actual payments of two of them until each 1/4. From a HMRC point of view, I would like to keep two DIV`s at per 1/4 so it does not look like a wage as per many suggestions. However I presume since I declare them per month HRMC will view it as per month though I delay payment or is it on payment date

It doesn't make any difference as it goes on the dividend vouchers.

And there is no rule about how often you can declare dividends.

[THEPUMA]

If I have to declare the DIV`s at the same time, can I withhold the actual payments of two of them until each 1/4. From a HMRC point of view, I would like to keep two DIV`s at per 1/4 so it does not look like a wage as per many suggestions. However I presume since I declare them per month HRMC will view it as per month though I delay payment or is it on payment date

You are worrying about nothing. If the paperwork is done correctly, HMRC cannot simply recategorise a dividend as a wage.

PUMA

[JamJarST]

all 4 x shareholders hold the same type , just different %

So in answer to your original question, no you cannot pay ot 2 of the shareholders monthly and 2 of them quarterly. What is the problem with paying them monthly? Can you not pay a bit extra monthly until all 4 can afford quarterly?

As an aside, why do you have 4 shareholders?

[THEPUMA]

If you have sufficient profits and everything is amicable, you could declare all dividends quarterly in advance then pay some out monthly and some quarterly.

PUMA

[contractor55]

If I have to declare the DIV`s at the same time, can I withhold the actual payments of two of them until each 1/4. From a HMRC point of view, I would like to keep two DIV`s at per 1/4 so it does not look like a wage as per many suggestions. However I presume since I declare them per month HRMC will view it as per month though I delay payment or is it on payment date

[contractor55]

all 4 x shareholders hold the same type , just different %

[Craig@Clarity]

Unless the shares are of different class then it's possible.

[JamJarST]

I have 4x shareholders. I`m happy to pay out 2x of the shareholders per quarter but the other two I want to pay out per month- Can I do this ?

No I don't think you can, dividends are declared for all shareholders of the same type of share and split according to the ratio of shareholding.