Dividend Question
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bigstevex
Posts: 913 Forumite
An odd question,
We pay ourselves a Dividend once a year from a ltd company we run. Our main income is our day jobs. For proof of income for Nationwide, would they want to see the dividend payment going into our account even though it's not recent, or do they just ask for a letter off my accountant to explain company profits?
I only ask this because we pay the dividend into the directors loan account and then withdraw it throughout the year when the company has available funds.
We pay ourselves a Dividend once a year from a ltd company we run. Our main income is our day jobs. For proof of income for Nationwide, would they want to see the dividend payment going into our account even though it's not recent, or do they just ask for a letter off my accountant to explain company profits?
I only ask this because we pay the dividend into the directors loan account and then withdraw it throughout the year when the company has available funds.
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Comments
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proof is from the SA302 i.e self tax return you submit, that would be proof. Some lenders may take an accounts report regarding dividends but you might want to check with a broker."It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"
G_M/ Bowlhead99 RIP0 -
As above, you are probably over thinking it.
SA302 and tax overview documents for the last 2 years should be plenty. Nationwide will average the last 2 years from memory.
If you have an accountant they will get them for you.I am a Mortgage AdviserYou should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Excellent, yes we have an accountant etc and all the self assessment info.
Thank you, I did think we were looking at it too much0 -
The important factor is when it is registered as a dividend and therefore when it is listed on the tax return.
Some lenders will include the profit regardless of whether you take it as dividend.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
The important factor is when it is registered as a dividend and therefore when it is listed on the tax return.
Some lenders will include the profit regardless of whether you take it as dividend.
This was my next question I've just thought of as I'm getting confused again. So our ltd company year runs Jan-Jan hence our profits show as follows
2015/16 - Accounts Jan 2016 Net Profit ~10K - Dividend paid April 2016 (i.e. 16/17 sa tax year) There was logic in this, as the 5K tax free allowance started in the 16/17 tax year.
2016/17 - Accounts Jan 2017 Net profit ~20K - Dividend paid April 2017 (i.e. 17/18 SA tax year)
2017/18 - Accounts Jan 2017 Net profit ~30K - Dividend not yet paid....
This is now my dilema, do I pay this dividend now so it goes on our 2017/18 SA Tax year for the purpose of getting a larger mortgage, or would nationwide accept it based on the Net profit of the company via a certificate from our accountant and I continue to pay this in our 2018/19 SA Tax year in April? But obviously if Nationwide wanted the SA302 for this dividend, it wouldn't be available until April 2019
Or should I consider other lenders if nationwide won't accept it this way. Also, technically my dividend for this year would be slightly skewed on my self assessment as it would have the 2017& 2018 dividends included so it would look higher than it actually is.
Hope that makes sense. We don't want to start looking at selling and buying if we're going to find out further down the line our mortgage amount isn't what we want/need and then have to back out
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Anyone any suggestions. Also any brokers in the Liverpool area people might suggest if nationwide wouldn't accomodate this0
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Bump.
Additional information, my accountant can't certify my Self assessment as I do that part myself, she can only certify my company accounts she's told me. Hence my above question shrinks down to, can I still use nationwide based on this or do I need a broker with options of other providers as I won't be using SA302 to prove income it will be my day job payslips and certified company accounts?0 -
Why don't you just look for a lender that focuses on Net Profit + Salary. Then the issue about the dividend is benign.I am a Mortgage Broker.
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice0 -
Do you know of any :beer:0
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So a bit more research says Nationwide will accept what I have as will the Leeds building society.
Nationwide offer ~£466K and Leeds £592k based on figures input
Both have PAYE full time jobs in addition to the above profits obviously hence those figures above0
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