[GNC] Dividend payout entry

[Foad Kasiri]

Thank you David for your helpful information. The Canadian Corporate Tax (T2) does no longer consider dividend payout  tax deductable. As such, I would like to know if the dividend entry that I have done in the retaining earning is correct and enough or need I do more? Thanks.


Foad

> On Oct 11, 2021, at 9:46 PM, davidcousens49 at gmail.com wrote:
> 
> Foad,
> 
> You could likely pay the dividend to yourself out of Retained Earnings annotated
> accordingly. Other than that local practice and any tax treatment may need to be
> considered. E.g. If you are subject to company tax whether your dividend is paid
> out after tax or before tax which could have imp[lications if your jurisdiction
> has a tax imputation scheme. Best to consult a local accountant who is familiar
> with your jurisdictional rules and requirements.
> 
> There will be a credit entry to the bank account for the dividend amount and a debit entry to Equity:Retained earnings for the same amount. 
> If the dividend is more complex and was a distribution to other shareholders
> then it might be more appropriate to create an Equity:Dividends Paid account in
> which the dividend payments to the individual shareholders were recorded and
> first transfer the total amount for the dividends into that account and record
> the individual payments to shareholders against this account against it.
> 
> David Cousens
> 
> 
> On Mon, 2021-10-11 at 12:53 -0700, Foad Kasiri wrote:
>> Hi:
>> I live in Canada and work as a consultant under my own one person consultant
>> incorporated company . I was wondering how to enter the dividend payout to
>> myself in Gnucash? I have Equity folder with two subfolders: Opening Balance
>> and Retained Earning. I did the following but I think it is more entry needed.
>> Thanks.
>> 
>> Best regards,
>> 
>> Foad
>> 
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>