Hi
We have a LTD client who has become a member of a buying society by buying some small number of shares (required to gain membership). They receive 8% settlement discount. The buying society shows this credit as profit share on their paperwork and excludes VAT. Just wanted some opinions on the VAT and CT600 position before treating them as dividends.
Thanks
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Co-op
Sounds like the divi you used to get at the Co-op. Which wasn't a proper dividend paid under deduction of income tax (before anyone mentions tax credits, I'm talking about a time before the imputation system), it was a discount on purchases.
Based on that, it's a reduction in the cost of whatever was bought - so essentially trading profits, I suppose - and, if it's a discount on standard rated stuff, you need to make an adjustment to your claim.
With more information, I may revise my view.