dividend

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 November 2010 thank u very much Aditya ji.

I have one more query regarding dividend.Whether Company can pay higher interim dividend say 60% thrice in a year.Whether any law binds the company for declaring such higher dividend thrice

Aditya Maheshwari

Aditya Maheshwari (Expert)
Follow

01 November 2010 U can grant as much as you want subject to companies transfer to reserves rules.

Ajay Mishra

Ajay Mishra (Expert)
Follow

02 November 2010 Agreed with Aditya...........

Transfer to Reserve : U/s 205(2A) it is provided that no dividend shall be declared or paid by a company out of the profits, except after the transfer to the reserves of such percentage of its profits, not exceeding 10% as may be prescribed.

The Central Government has framed The Companies (Transfer of Profits to Reserves) Rules, 1975. According to these rules, no dividend can be declared or paid by a company except after the transfer to the reserves of the company of a percentage of its profits as specified below:

(1) Not less than current profits - 2.5% of the - Where the dividend exceeds 10% but does not exceed 12.5%.

(2) Not less than current profits - 5% of the - Where the dividend exceeds 12.5% but does not exceed 15% of paid up capital.

(3) Not less than current profits - 7.5% of the - Where the dividend proposed exceeds 15% but not above 20% of the paid up capital.

(4) Not less than current profits - 10% of the - Where the dividend exceeds 20% of the paid up capital

If a company wants to make additional voluntary transfer of a higher percentage to the reserves, it may do so as per Rule 3 of these Rules.

Regards

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

rana andcompany

MAYUR

Tanuj Kumar Sharma

Aravind S

UPENDRAN YADAV

Subscribe Now

dividend

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA