Dividends and self assessment

Can I backdate dividends and is it necessary so that it falls into correct SA year?

Didn't find your answer?

If the year end is June 18 and I declare dividends at YE, will they be part of 2018/19 self assessment and fall into the rules of £2k tax free?

In other words can I (and do I need to?) backdate the dividends to March 18 so that it's under 17/18 tax rules and £5k tax free limit?

NB There are distributable profits but nothing has been paid out yet

Thank you!

Replies (16)

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By Matrix
20th Nov 2018 20:03

No of course not. If you are a company Director then you should familiarise yourself with your duties and responsibilities and, if you are unable to understand them, seek professional assistance

Dividends can only be declared prospectively so any dividend declared today will fall within the 2018-19 tax year.

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Replying to Matrix:
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By User deleted
20th Nov 2018 20:17

Thank you, I was hoping to find some assistance here! I should have added YE June 18 accounts are not complete or filed yet.

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Replying to User deleted:
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By Matrix
20th Nov 2018 20:21

Prospectively means any day from today.

No you only include what actually happened in the accounts not what you would have liked to have happened to get a better result.

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Replying to User deleted:
RLI
By lionofludesch
21st Nov 2018 07:11

Quote:

Thank you, I was hoping to find some assistance here! I should have added YE June 18 accounts are not complete or filed yet.

That's not the issue. The dividend wasn't declared in March and you can't change that now. You're too late.

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By johngroganjga
20th Nov 2018 20:04

You are too late to declare dividends at the year end because it is now November, and you say the year end was June (unless you have a time machine of course).

Any dividends you declare now will be taxable in 2018/19.

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Replying to johngroganjga:
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By User deleted
20th Nov 2018 20:16

I should have said that YE accounts are just being done, so not finalised or filed anywhere yet, therefore I can declare a YE dividend still, no? :)

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Replying to User deleted:
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By andy.partridge
20th Nov 2018 21:26

You are a muppet who refuses to believe the advice given and is holding out in the hope that someone in the universe will agree with you.

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Replying to User deleted:
JCACE
By jcace
20th Nov 2018 22:10

You cannot today decide to do something yesterday, yet alone 8 months ago.
What you should have done was make that decision 8 months ago.

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Replying to jcace:
Lone Wolf
By Lone_Wolf
21st Nov 2018 09:28

Oh can’t you…

Given that physicists have postulated that time may in fact be circular, and if we go far enough into the “future” we would come back to where we are now in time, then surely one can decide to declare a dividend now for say the 2017/18 tax year, and as in a universe with circular time, every decision can be said to be made in both the past and the future, then entering the dividends into the accounts “post year end”, is merely the recording of a decision that has been taken in the past, and so doesn’t present any legal/moral dilemmas.

That’s my view – good luck arguing it in court though.

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By frankfx
20th Nov 2018 20:26

You have asked the question.

What do you think the answer is?

How many documents and transactions have you encountered, in business or personal life, where you can say

''please back date''

Example

Buy a PC from PC WORLD.

Use credit card

and request the cashier to turn the clock back on Point of Sale software.

Or

Ask your accountant to re - date his invoice .

So that it falls into the 6 month pre -VAT registration date to enable Input VAT recovery .

Is your accountant likely to accommodate your request?

Running and managing a company comes with responsibilities.

You need to see if you find a reason why things were left undone at March 2018 …………..and justify your actions to correct the undone. But with a 31 March 2018 date stamp.

The farmer who sows his seeds late can not reap in the summer.

Just a shaving mirror or make -up mirror moment.

Your accountant may be able to help steer you .

''Nothing'' has been '' paid''...……..now you want to reclassify it as a ''something ''.... and label it with a date too.
That is creative accounting .

Big Bang and a 13.8 bn year old time stamp come to mind.
Now that sounds/ looks creditable.

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By Accountant A
20th Nov 2018 20:39

You have previously posted questions suggesting you are an accountant. Are you a member of an accountancy body?

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By JCresswellTax
21st Nov 2018 09:57

I disagree with all of the above.

No problem in backdating dividends to an earlier date, maximum backdating allowed under legislation is 3 years though.

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By David Heaton
21st Nov 2018 11:01

Basic company law stops you dead. See https://www.gov.uk/hmrc-internal-manuals/company-taxation-manual/ctm15205.

An interim dividend is paid when it is paid, ie, cash (or a credit to a DLA) moves from company to shareholder. A final dividend is paid when it is declared to be paid. You clearly haven't done either yet, as the accounts aren't finished.

You haven't paid a dividend of any kind, so any attempt to backdate one by making up some paperwork for the past would amount to fraudulent evasion, the maximum penalty for which is seven years, and/or a fine (if they take you to Crown Court - it's only six months on summary conviction in a magistrates' court, plus the loss of your ability to practise). It's also a money laundering offence, as your client has proceeds of crime. And you'd be complicit. Don't go there.

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By JDBENJAMIN
21st Nov 2018 18:33

I wonder how many of you who said you can't backdate a dividend managed to keep a straight face?

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Replying to JDBENJAMIN:
RLI
By lionofludesch
21st Nov 2018 18:46

All of us, I would imagine. It's a serious matter.

Of course, it was a lot more difficult to backdate dividends in the days of ACT.

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Replying to JDBENJAMIN:
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By andy.partridge
21st Nov 2018 22:02

Oh, you’re that kind of accountant, are you?

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