Interim dividends. Accounting and Taxation

The purpose of existence of any commercial company is to make a profit, and when this is achieved, the founders and other shareholders have the right to expect the payment of income in the form of dividends. The company can calculate and issue them either based on the results of the past year or for a quarter, half a year or 9 months. Such intra-annual incentives are called interim dividends and are calculated on the basis of accounting data on the amount of profit (net of taxes) for the reporting time period in question. It is net profit that is the source of dividend payments.

Let’s figure out what kind of documentation should be used to document the issuance of interim dividends, and how it should be reflected in accounting and reporting.

Rules for payment of interim dividends

So, participants, owners and employees - holders of shares have the right to claim dividends at the end of the year or interim.

The concept of dividends is legislatively approved only for joint stock companies. In the provisions of the Law “On LLC”, the term “redistribution of profits” is used to define such compensation, but to simplify the presentation of information, we will call them dividends.

The payment of dividends can only be initiated by the adoption of an appropriate decision by the meeting of the founders of the JSC/LLC or the sole founder of the LLC. The same document also states the amount of payments due.

The right to issue interim dividends (as well as for the year) is secured by the norms of laws No. 208-FZ “On JSC” and No. 14-FZ “On LLC”, which regulate the activities of enterprises of these forms of business. JSCs pay dividends on placed shares based on the results of a quarter, half a year or 9 months, while LLCs distribute profits among their participants.

Let us pay more attention to the criteria for paying dividends in LLCs, since most enterprises operate in this economic status. Law No. 14-FZ allows the frequency of profit distribution between participants to be established not only once a year, but also once every six months or quarterly, but does not oblige it to be recorded in the charter. Payment of dividends is the right of the enterprise, i.e., having transferred dividends, for example, for the 1st quarter, the company is not obliged to subsequently do this quarterly. She has the right to decide on payment based on her own capabilities at the end of any reporting period. The period during which the LLC has the right to make a decision on the payment of interim dividends is not limited by law, but the time for their payment cannot be more than 60 days from the date of the decision on the distribution of profits and its approval.

There are restrictions on the amount of dividends paid. For a joint-stock company, the volume of transfers should not exceed the amount recommended by the board of founders, and it should be transferred at a time to all shareholders (Article Federal Law No. 208-FZ). For an LLC, the total amount of dividends paid during the year should not exceed the amount of net profit received for the year.

Distribution of profits for payment of dividends

The profit received by the company from commercial activities can be distributed among participants (shareholders) in the form of dividend payments. Net profit (after taxes, fees, and other obligatory payments) is subject to distribution.

The basis for payment is the corresponding decision of the board, issued in writing. Let us note that, based on the decision of the company’s management, both the entire profit received by the company at the end of the year (another reporting period) and part of it (in a fixed amount or in the form of a percentage) can be used to pay dividends.

If an organization pays interim dividends, then the basis for distribution is the net profit received at the end of the reporting period (quarter, six months, 9 months).

Interim dividends in LLC: how to calculate

Dividend amounts are calculated based on the amount of retained earnings, the amount of which is reflected in line 1370 of the balance sheet. This indicator is the profit at the disposal of the company; it is formed based on the total values ​​for all years of the enterprise’s activity. The meeting of founders, when announcing the amount of dividends to be paid, is guided by the volume of accumulated profits.

Dividends are calculated based on their amount to be paid, approved by the decision of the founders. Typically, income in an LLC is distributed in proportion to the shares of participants invested in the authorized capital, within the limits of the amount of dividends due indicated in the protocol, and in a JSC - according to the types and number of shares held by the holders.

When dividends cannot be distributed

Of course, there will be no dividends to be paid if the company did not conduct business or if it turned out to be unprofitable. It is impossible to distribute as profit such funds as, for example, a loan taken by an organization for certain purposes, or to pay dividends when there are outstanding losses from previous years.

Profits from the activities of the company cannot be distributed in the following situations (Article 29 of the Law “On LLC”):

• the authorized capital is not fully paid;
• the company meets the signs of bankruptcy at the time the decision to issue dividends is made or will have such signs after their issuance;
• the value of the LLC's net assets is less than its authorized capital and reserve fund or will become less than their size as a result of the decision to pay dividends;
• before payment of the actual value of the share or part of the share of a company participant;
• other cases provided for by law or the organization’s credit obligations.

If these circumstances cease, then the LLC is obliged to pay its participants the profit, the distribution of which among the company’s participants was decided.

Interim dividends: postings

In accounting, data on accrued and issued amounts of dividends are accumulated for settlements with the founders on account 75/2, and with the company’s employees for settlements with personnel - on account 70. The corresponding account is the retained earnings account - 84. Typical accounting entries for these operations are as follows:

Example

Comfort LLC decided to distribute a share of the profit received for the 1st quarter of 2022 in the amount of 2,000,000 rubles. between the founders:

— I.T. Sergeev, who has a 30% share in the company’s management company;

— Komarov A.R. (45% in the management company);

— Temp LLC (25% in the management company).

The accountant made the calculations:

Dividends are transferred to participants in May 2022. Taxes are charged on payments:

– personal income tax for individuals – at a rate of 13% on amounts accrued to tax residents, a rate of 15% applies to the income of individuals who do not have resident status;

– income tax for the legal entity Temp LLC, a participant in Comfort LLC and a resident of the Russian Federation - at a rate of 13% of the accrued amount. The tax rate for non-residents is 15%.

How to calculate and pay dividends to participants

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Let's imagine this situation: You are an accountant in an LLC. At the end of the year, the company's retained earnings amounted to RUB 800,000. The company has two participants, Komarov and Nikiforov, their shares in the authorized capital are 60% and 40%, respectively. The founders analyzed the statements you provided and told you to pay them dividends from all profits...

Your actions? Having trouble? Don't know where to start?

Then I hope that our article will be useful to you!

Let's start classically - with a definition.

Let me add some background information... Net profit depends on the chosen taxation system. For example, if your company is on the general taxation system, then this is the profit that remains after paying the income tax, if on the “simplified” system, then you do not pay income tax, respectively, the net profit is formed after you have paid the tax, in connection with the use of the simplified tax system...

To gain practical skills in accounting, “closing” the year, reforming the balance sheet, and calculating net profit, I highly recommend taking a look here>>>

And now let’s return to our situation, which I voiced at the beginning of the article. Let me remind you that you need to distribute net profit in the amount of 800,000 rubles. among the founders, in proportion to their shares, pay dividends, and, of course, reflect these transactions in accounting.

Let's get started. Let's assume that all conditions and formalities are met. Let's do the calculations:

Komarov – 800,000 x 60% = 480,000 rubles.

Nikiforov - 800,000 x 40% = 320,000 rubles.

In theory, the next stage after accrual of dividends is their payment. In principle, this is the case, but do not rush to do this right away until you have withheld personal income tax. The fact is that the tax code obliges the tax to be withheld and transferred to the budget when a Russian organization pays dividends to a company member, if he is an individual. You can read about this in paragraph 3 of Art. 214 Tax Code of the Russian Federation. The accountant also needs to navigate personal income tax interest rates in each specific case in order to avoid mistakes and claims from regulatory authorities. So, in our situation, the founders are residents of the Russian Federation, therefore, the personal income tax rate will be 13%. This is stated in Art. 224 Tax Code of the Russian Federation.

Thus, the founders from our example will receive:

Komarov – 480,000 – (480,000*13%)= 417,600 rubles.

Nikiforov – 320,000 – (320,000*13%)= 278,400 rubles.

On my own behalf, I would like to add that there is no need to accrue insurance premiums for dividends, since these payments do not fit under clause 1 of Art. 420 of the Tax Code of the Russian Federation, that is, they do not apply either to payments under employment contracts or to payments under GPC agreements.

Let's start reflecting all the transactions we have made on the accounting accounts.

Date of the protocol of the decision to pay dividends

Almost all accountants work in the 1C 8.3 program, so it would be appropriate to digress a little and briefly mention how to process the calculation of dividends in 1C.

Unfortunately, this accounting program does not provide a special document, so usually such operations are performed manually in the section of the same name “Operations entered manually”

.

If you feel that you have gaps in working with the 1C program, then pay attention to our practical courses 1C >>, in which you, under the guidance of an experienced teacher, will learn on your own not only to enter documents, but also to perform other important operations - payroll, taxes, filling out declarations and much more. Choose the course that suits you >>.

Date of payment of dividends to founders

And some more useful information in the article. These are the most common questions from our listeners, and of course the answers to them on this topic.

Question:
How often can dividends be paid in an LLC?
Answer:

By law, dividends are allowed to be paid based on the results of a quarter, half a year, 9 months, or a year. But any option must be enshrined either in the charter of the LLC or in a decision of the general composition of participants. (clause 1 of article 28 of the LLC Law)

Question:
Are there any specific deadlines for paying dividends?
Answer:

Yes! For an LLC, this is 60 calendar days from the date of the protocol on the decision to pay dividends. (clause 3 of article 28 of the LLC Law)

Question:
Please tell me, are dividends paid only on the basis of retained earnings for the past year, or can retained earnings for previous years be taken into account?
Answer:

All net profit, both for the past year and for previous years, is subject to distribution.

Question:
Is it possible to pay dividends in cash from the cash register?
Answer:

There is no direct ban on paying dividends from the cash register. But it should be borne in mind that it is prohibited to pay dividends from funds received as revenue. That is, if you want to pay dividends from the cash register, you must first hand over all cash proceeds to the bank, and only then withdraw them specifically for the payment of dividends. (Instruction of the Central Bank dated 07.10.13 No. 3073-U)

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Interim dividends in financial statements

The accrual of interim dividends is recorded in the debit of account 84, reducing the amount of profit for the corresponding reporting period - quarter, half-year or 9 months. from the amounts of profit for the quarter, half a year, 9 months, in line 1370 for the amount of due payments. In the balance sheet, the amounts of interim dividends accrued during the year are indicated in specially open lines deciphering the use of profits - 1371, 1372, etc. The paid dividend amounts are reflected in the balance sheet asset, reducing the amount of cash in line 1250. The data in the example given will be reflected in the balance sheet for the half-year.

It is also impossible to see the specific value of dividends paid in the financial results statement. This indicator reduces the total amount of net profit, which is indicated in line 2400. It is more advisable for the user to refer to the explanations attached to the company’s financial statements. In them, the company records the amounts of accrued and paid income and the frequency of payments made.

Rationale

The company has the right to use the profit received for six months to pay dividends, if a profit is made, regardless of the fact that a loss is expected for the year.

Accounting

As mentioned above, the source of payment of dividends is the organization’s net profit according to the financial statements.

In accounting (before the end of the reporting year), this value represents the credit balance in account 99 “Profits and losses”, which is intended to summarize information on the formation of the final financial result of the organization’s activities in the reporting year.

Account 99 is closed at the end of the reporting year when preparing annual financial statements. In this case, by the final entry in December, the amount of net profit (loss) of the reporting year is written off from account 99 to the credit (debit) of account 84 “Retained earnings (uncovered loss).”

The allocation of part of the profit of the reporting year to the payment of income to the founders (participants) of the organization who are not employees of the organization, based on the results of the approval of the annual financial statements, is reflected in the debit of account 84 and the credit of account 75, or 70 “Settlements with personnel for wages”, if the participants are employees .

A similar entry is made when making a decision on the payment of interim income (see also Letter of the Ministry of Finance of Russia dated January 27, 2012 N 07-02-18/01 “Recommendations for audit organizations, individual auditors, auditors on conducting an audit of the annual financial statements of organizations for 2011”) .

In this case, the amounts of accrued dividends can be taken into account in analytical accounting in account 84 separately. This is necessary for a separate reflection of the amounts of dividends paid in the financial statements of the organization.

Accounting entries:

Dt 84 - Kt 75 - as of the date of the decision, dividends were accrued based on the results of the six months (based on an extract from the decision of the company’s participants);

Dt 75 - Kt 68 - personal income tax is withheld on the date of payment;

Dt 75 – Kt 51 – dividends paid.

Personal income tax (NDFL)

An organization paying income in the form of dividends is a tax agent and is obliged to calculate, withhold and transfer to the budget the appropriate amount of personal income tax (clause 1 of article 226, clause 3 of article 214 of the Tax Code of the Russian Federation).

Personal income tax in respect of income received in the form of dividends on shares (stakes) of a Russian organization is calculated and paid taking into account the provisions of Art. 226.1 of the Tax Code of the Russian Federation (clause 4 of Article 214 of the Tax Code of the Russian Federation).

Consequently, on the date of payment of interim dividends, the organization withholds personal income tax. The tax must be paid to the budget within a month from the date of payment of funds in the form of interim dividends. This follows from the provisions of paragraph 9 of Art. 226.1 Tax Code of the Russian Federation.