Dividends and credit rating

bigmun

Hi

If my gross income is £50k but I only take £7488 as salary and the rest as dividend, then if I apply for a credit card or a mortgage, would the bank see me as someone earning £7488 or £50k? In other words, is the banks' notion of income same as the taxman's? Quite a few cards require a minimum of £20k or so. I can sort of understand if banks don't accept dividends, since there's more uncertainty about the continuation of payment.

Thanks!

meer53

Dividends are not included in any income calculations when i am assessing for any lending.

InsideInsurance

It will depend firstly if they ask for income or if they ask for salary.

From my experience, having been in a similarish situation, most have said to include the dividends given they are guaranteed income (or at least as guaranteed as the salary component) and is not the same as for example dividends from shares you hold in a 3rd party PLC.

Personally I always end up asking the institution in question because of cause the dividends you pull down are already partially net and so actually having a total gross figure is difficult. The £50k you mention of cause if your companies income not yours and presumably your company has at least some expenses of its own (guessing PI/PL insurance, accountants/ annual returns etc)