Accounting Journal

Accounting Journal

Do you have to take a dividend? Reasons why not to

Asif Patel's avatar
Asif Patel
Sep 11, 2024
∙ Paid

Many directors believe they have an absolute right to monies deposited in a company's bank accounts. However, payment cannot just be withdrawn as there are set procedures to follow to be legally compliant.

'Illegal' dividend

A dividend is a distribution of post-tax profits and it can only be paid if the company has sufficient retained profits from which t…

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