Types of Dividends

[alain]

I would like to know the difference between interim dividendes and final dividendes, also the tax you pay on the dividendes. i am french and i just bought 60% of a company and need to know the tax systeme ( Dividendes or salary ) Thaks for your help.

[jpcentral]

Best to work backwards. A Final Dividend is a dividend which is declared once the full profits of the company are known - usually at the end of the year. An interim dividend is a dividend which is paid during the year before the final profit figure is known. Dividends can only be paid from profits.

The taxation of dividends depends, to some extent, on the size of the company. Dividends are paid out of the taxed profits of the company (ie after tax has been paid) so they are treated as if some tax had already been paid.

As a general guide, it is better to take the a salary equivalent to the Personal Allowance (£4,895 pa) and the rest of your income as dividend. But (and it is a big BUT) individual circumstances may mean that this is not best in your particular case. You really need to speak to an accountant or tax adviser to go over your particular circumstances.

Of course, if you own 60% of the shares, someone else owns 40%. Dividends cannot just be paid to some shareholders and not others, so, if you receive £6,000 in dividends, the other shareholder(s) must receive £4,000. If circumstances differ, this can often mean that compromises must be made. There are ways around this by having different classes of shares but you really need professional advice.


John Perry
Central Business Services
Loughborough
(01509) 416549

The answer given above is based on incomplete information and you should not rely on it without taking further professional advice.

[alain]

i understand if i pay to myself some dividend, i need to pay to the 3 other people who had 40% share some dividend.

i would like to know if i can give somme dividend every month to 4 of us for pay less tax. Where are all directo also of the company, i want to give a small salary plus a dividende evry month.

if somebodies can help me, thanks