What to investigate and how: Ultra vires dividends: When and how is a dividend paid?
In companies with common directors and shareholders dividends often replace salary or remuneration to the directors because dividends have the advantage of minimising NIC liability. Dividends are normally proposed by the directors and approved by the shareholders at the company’s Annual General Meeting (‘AGM’). Often there will be an interim dividend paid during the year relating to a period of the company’s performance.
