Close company dividend payment timing

Poodle

Hi

I recall from somewhere reading that when dividends are paid by a close company to a director, within 30 days of the end of the tax year, then that dividend has to be included in the directors SA for the previous tax year.

Any expansion on this would be appreciated

Poodle

deanshepherd

First I have heard of it.

Unless you mean, for example, dividend declared 31st March but physically paid 30 days later.

As oppose to any dividend paid up to 5th May.

Poodle

Hi Dean,

Thanks for the response.

I mean a dividend declared and paid to a DLA on the 30th April to prevent o/d situation on DLA of approx £30k.

I set up a company policy for this one that any o/d DLA will be cleared by dividend or paying in of personal funds for NI purposes. It's just that this happened so close to the tax year end and my old grey matter suddenly remembered something about a 30 day rule from college but I just cannot find anything about it.

Poodle

PS how has the move gone

deanshepherd

I have not heard of that rule and I have advised many of my clients to defer their usual March dividend to 6th April to delay the tax so I would be very upset if it did exist!

Move has gone well - really enjoying being in a separate office again. Only 10 minutes from home so not exactly a 'commuter' again either!

Poodle

Thank Dean

Done a little further CPD on the timing of earnings received for directors and as you say since declaration was on the 30th April then payment on 30th April is fine.