Dividends - Net or Gross

tier_2_applicant · Post by **tier_2_applicant** » Mon Feb 13, 2012 10:52 am

Hello,

I have a query regarding income from dividends. For past earnings should I consider net dividends or gross dividends?

I assumed that I should consider gross dividends just as we consider gross salary. However the info on http://firstmigration.com/visas/uk/tier ... -inside-uk suggests otherwise.

I understand that this link is for Tier 1, but the rule should be same for ILR. Or is it not?

Thanks.

ILR_UK_ · Post by **ILR_UK_** » Mon Feb 13, 2012 1:41 pm

That is not Official Link. Why dont you check in UKBA Site.

nnj10 · Post by **nnj10** » Mon Feb 13, 2012 8:21 pm

It should be Gross Dividend which includes 10% Tax credit.
i.e. If your net dividend is £900, you will be able to claim income of £1000 towards your gross dividend and it includes £100 towards tax credit.

Make sure both Gross and net dividend amount is clearly shown on the dividend voucher.

tier_2_applicant · Post by **tier_2_applicant** » Tue Feb 14, 2012 9:36 am

Many thanks ILR_UK_, nnj10.

Apologies for beating a dead horse but I did have a look at the guidance notes(http://www.ukba.homeoffice.gov.uk/sitec ... idance.pdf).

Point 92 on page 17 says that "If an applicant is in salaried employment, (including a Director of a company for example) we will assess the applicant’s gross salary before tax." - which is fine.

Point 93 says that "If an applicant is self-employed and has chosen to retain the profits within the business, his/her earnings are limited to the share of the business’s net profits to which he/she is entitled."

I understand that as the director of my company I am 'employed' and not 'self employed'. But just wondering if dividends are treated as per point 93? Am I thinking too much?

Many thanks.

sunil.suneel · Post by **sunil.suneel** » Tue Feb 14, 2012 10:21 am

Yes you seem to be thinking too much ... dont get confused, you should only consider point 92 in your case. You have nothing to do with self employed clause.

tier_2_applicant · Post by **tier_2_applicant** » Tue Feb 14, 2012 11:09 am

Many thanks everyone.

nnj10 · Post by **nnj10** » Tue Feb 14, 2012 9:04 pm

Point 93 is only valid in case a director has not declared a dividend and chosen to retain the profit within the company, you can then claim your share as Income.
I guess doest not apply for 99% of the people, as most would declare dividend keeping money for Corp Tax in Business Bank Account.

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Dividends - Net or Gross

Dividends - Net or Gross