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Can a dividend be declared even if no profit was made this year?

fodigie
by fodigie 15 September 2012  |  Comments 1 comment  |  Love Love  0 loves

My private limited company only made a profit of £1000 during 2011, but it made a profit of £15,000 in 2010 (I did not declare a dividend in 2010).

Can I declare a dividend of £10,000 now and use my retained profit of £16,000 to pay it?

Also, if I have not physically paid the dividend from my business bank account to the shareholder (me), can I treat is as a creditor on the Balance Sheet?

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Comments (1)

  • MikeGG1
    Love rating 881
    MikeGG1 posted

    You can but you must have a full audit trail and declare it on the company and the personal taxation forms.

    Posted on 15 September 2012 | Love Love  1 love Report

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