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Paying a dividend - company requirements

Anyone know what formalities I have to go through to arrange to pay a dividend?

My brother is the sole shareholder and director of a company which falls under ir35 regulations. We have been diligent and paid the Tax and NI properly, but as his allowable expenses do not exceed the blanket 5% deduction allowed by IR35 we have some cash available. The only thing that I can see can be done with this is to divi it out.

I want to make sure that the tax is properly accounted for, and all formalities done properly, but I can't seem to find the right google search that gives me the answer!

Thanks for any / all advice!

Matt

Reply to
Matt Larkin
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Officially, you should have a board meeting to approve the dividend, and make sure it is minuted. Then, any dividend is you pay is paid net of a

10% notional tax credit - you don't pay this to anyone, just show it on the dividend voucher.

When it comes to doing your self assessment tax return, you will need to include this in your income. If you are a higher rate tax payer, there will be further tax to pay at this stage.

Reply to
Jonathan Bryce

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