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Dividend problem with wife

My wife is demanding I cancel her dividend

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Hi there,

I recently closed my ltd company, all corporation tax / vat etc was paid up to date. There was still some funds left over, so my wife (shareholder) and I declared us a dividend, and I did the self-assessment for us both. I paid quite a lot tax on my share, she did not actually need to (never worked, has no income and it was not a large amount) We agreed to pay both dividends into the mortgage to help reduce it.

We have split up - and she is is now demanding that I "go to the tax man and remove her dividend" so that she will not have a higher tax code...? She admits that this was not our original agreement, but she does not care about what stress it may cause me. Actually, what she is saying is that I never paid her the money but kept it for myself...

She is not a UK citizen, and is here on a spouse visa (if that makes any difference).

What can I do? I am happy to take over any liability, but is this even possible...?

many thanks in advance...

AikenD

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18th Feb 2019 21:45

AikenD wrote:

What can I do?

Speak to your accountant and your solicitor. They will have all the documentation that you put in place for the transactions that you describe.

Thanks (2)
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18th Feb 2019 21:58

If it was a dividend it was a dividend. That’s all there is to it.

I might be worried, though, that you if you didn’t go through proper procedures. And did your wife authorise you to prepare and file her tax return?

Paying a dividend might not have been the smartest move, but it’s done now.

Sounds like you didn’t have an accountant. If so it was perhaps a false economy.

Thanks (1)
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to andy.partridge
18th Feb 2019 22:08

andy.partridge wrote:

I might be worried, though, that you if you didn’t go through proper procedures.

Of course he did! He's a responsible company director who understands the value of good professional advice and the need for proper corporate governance even in small companies. ;)

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to andy.partridge
18th Feb 2019 22:25

What? You mean people without accountants come on here to ask questions?

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By Alex_T
to DaveyJonesLocker
19th Feb 2019 11:11

It's like groundhog day!

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By AikenD
to andy.partridge
18th Feb 2019 23:35

andy.partridge wrote:

I might be worried, though, that you if you didn’t go through proper procedures. .

Well, we had a meeting, spoke about the money, decided together that it was appropriate, and decided together what we would then do with the money. I then did the paperwork. Then some months later time for the Self Assesment. I asked her if I could do hers through my accountant and she agreed.
Then - we split up - and now she is shouting about not wanting the dividend payment.

Please tell me what procedure here was wrong?

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By Mr_awol
to AikenD
19th Feb 2019 08:35

AikenD wrote:

andy.partridge wrote:

I might be worried, though, that you if you didn’t go through proper procedures. .

Well, we had a meeting, spoke about the money, decided together that it was appropriate, and decided together what we would then do with the money. I then did the paperwork. Then some months later time for the Self Assesment. I asked her if I could do hers through my accountant and she agreed.
Then - we split up - and now she is shouting about not wanting the dividend payment.

Please tell me what procedure here was wrong?

That almost certainly never happened. Do you have it on video too?

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By AikenD
to andy.partridge
18th Feb 2019 23:37

andy.partridge wrote:

Paying a dividend might not have been the smartest move, but it’s done now.

Sounds like you didn’t have an accountant. If so it was perhaps a false economy.

My accountant said this was ok - so please again, explain to me why a dividend was the wrong move? I honestly do not understand that. Many thanks in advance for taking the time to explain...

AikenD

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to AikenD
19th Feb 2019 06:47

Don't worry about it. What's done is done. (That's also my answer to your OP.)

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By Matrix
18th Feb 2019 22:29

She can call the tax office and advise that she will no longer be receiving dividends and they will adjust her tax code.

Thanks (3)
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By AikenD
18th Feb 2019 23:41

When I say that she has admitted that she has changed her mind about it after the fact (OK, 4 + months ago) I mean that I actually have her on video admitting that she changed her mind ... and admitting on video that she is just being as difficult and hurtful as possible.

(phew)

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to AikenD
19th Feb 2019 10:26

AikenD wrote:

I actually have her on video

What other videos do you have of her? Asking for a friend.

Thanks (4)
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19th Feb 2019 08:07

Who cares. I hope you told her you were videoing her. The divi was documented at the time, show her the bloody documents.
You have an Accountant, speak to your Accountant. Get her to speak to the business Accountant.
Doing her tax return is a bit controlling, her letting you is a bit stupid, except if she hadn't she would have a big fat fine by now, offering to pay her liability is a bit stupid, tell her to stop being stupid. The pair of you need to get a grip before it gets so much worse, as divorces usually do.
Aweb is a site for accountants!

Thanks (2)
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By SXGuy
19th Feb 2019 08:04

This is an issue for your Accountant and Solicitor, nothing we can do or advise to change the past. Please speak to them.

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19th Feb 2019 09:06

Seeing as a divorce is going through, maybe a comma needs inserting?

My wife is demanding, I cancel her dividend.

Thanks (1)
19th Feb 2019 09:23

The problem you have is that if she didn't authorise submission of her Tax Return, she can claim she never received the cash for the dividend and pursue you for it.

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19th Feb 2019 09:28

AikenD wrote:

She is not a UK citizen, and is here on a spouse visa (if that makes any difference).


Just wait until 29 March and all this will be sorted out for you.
Thanks (1)
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19th Feb 2019 09:28

One for your accountant and solicitor to sort out. The issue you will have a problem with is that she is claiming she never received the dividend money, which she didn't it went towards the mortgage. Do you have evidence of her agreement to that?

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19th Feb 2019 09:52

If she's still got the shares, she's still got the problem.

Tell her to sign a share transfer form in your favour and the problem will, eventually, go away.

Meanwhile, the notion that you can approach HMRC to discuss her tax affairs is laughable. Is a 64-8 in place ?

Ultimately, it's a solicitor's job. An accountant might be helpful but a solicitor is vital.

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19th Feb 2019 10:38

Seemples

Say NO can't do it. No stress involved

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19th Feb 2019 11:05

I'm struggling to see what the issue is here. Presumably this relates to the 17/18 tax year?

The OP says there was no tax on his wife's share of dividends so presumably it was under 11.5k. Is there something that affects her going forward for an event that occurred in a previous tax year?

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to legerman
19th Feb 2019 11:42

This was my exact thought. I fail to see her thought process, here.

Thanks (1)
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By AlanAG
19th Feb 2019 11:26

You refer to a tax code in your initial post, would this refer to her tax code being changed for the current tax year due to circumstances in the previous year? If so, she, or I assume the accountant still has authority, can contact HMRC and have the code reset due to the change in circumstance.

In terms of her saying you haven't paid her the dividend, if the amount isn't going directly into her account and it went to yours, you haven't got a leg to stand on in court and will have to pay her the full dividend amount.

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19th Feb 2019 11:28

Do you have a link for the videos?

Thanks (1)
20th Feb 2019 10:37

Your answer lies in your question.

She is here on spouses visa, she is causing you problems and is no longer going to be your spouse.

Google "Home Office" your problems will be quickly resolved..

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19th Feb 2019 13:12

"She agreed to pay both dividends in to repay the mortgage." If it was in joint names she HAS received the money

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to bernard michael
19th Feb 2019 13:45

I was wondering if it was a joint mortgage, plus also pondering on whether the recent company shut down was just a short while before split. A cynic, moi? Dont know what you mean!

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25th Feb 2019 09:32

If she is here on a spouse visa, you need to inform the home office that the relationship no longer continues, they will then hopefully repatriating her to her home country!

Problem solved!

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