Dear All,
Please clarify following:
If Company wants to declare Interim Dividend as on 15th October, 2010 then financials should be prepared upto which date.
Regards,
CS Pooja Sawant
SUNIL KUMAR JAIN
(PRACTISING COMPANY SECRETARY)
(187 Points)
Replied 07 October 2010
Dear Pooja,
There is only one requirement that when the Board of Directors declares an interim dividend there must be sufficient profits earned during the current financial period to cover the amount of dividend. In case sufficient profit has been earned say during April to August,2010;then financials for such period are to be considered.While planning for declaration of interim dividend, you are to keep in mind the provisions for income tax, amount of current profits to be transferred to General Reserve at the year end. Dividend Tax is to be deposited within 14 days of declaration of interim dividend.
I have handled a few cases of declaration of interim dividend of a few client companies.If you require any further clarification , please write to me.
Regards,
Sunil K. Jain, FCS, AICWA, BAL
Practising Company Secretary
skj13 @ rediffmail.com,9810104162
CS Pooja
(Company Secretary)
(305 Points)
Replied 08 October 2010
Thank You Sir..
I have following queries:
1. if i want to declare the interim dividend on 15th October, 2010 then the financial statements should be prepared upto 30th September, 2010 (i.e 6 monthly financials) or upto 15th october, 2010 (i.e the date of declaration of dividend).
2. provision has to be made for transfer to General Reserve means actual amount to be transfered to general reserve at the end of the financial year and not at the time of Declarion of Interim DIvidend?
3. whether Provision for deffered tax is also to be considered?
4. What is current Dividend Tax Rate
I will be obliged if you clarify the above points
SUNIL KUMAR JAIN
(PRACTISING COMPANY SECRETARY)
(187 Points)
Replied 08 October 2010
Dear Pooja,
1.Consider Financial Statements upto 30th September,2010.
2. Transfer to General Reserve to be made at the year end.
3.Provision for deffered tax is to be considered at the year end.
4. Current Dividend Tax Rate is 15%,plus 7.5% Surcharge plus 3% Education Cess;( the effective rate comes to 16.60875%)
Regards,
Sunil K. Jain, FCS, AICWA, BAL
Practising Company Secretary
skj13 @ rediffmail.com, 9810104162
Live class on PF & ESI Enrollment & Returns Filing(with recording)
CAclubindia
