How to calculate dividends?
A novice trader often pays attention tothe amount of expected dividends. The very process of dividend formation is quite simple - when a company makes a profit, some part of this profit is paid to the shareholders of this company. In the case of ordinary shares, it is difficult to immediately determine the amount of future dividends. You can calculate the size of the dividend by taking the average dividend for the last number of years as a percentage of net profit. This determines the current size of the dividend. However, dividends from ordinary shares of the company should not be paid under a broad investment program. In this case, dividends will not be paid even by a company that usually encourages its shareholders. Analyzing the size of dividends, it is necessary to take into account that the money that will be paid to shareholders will not be targeted for the development of the company. It is also worth analyzing the amount of interest from the company's total profit, which is paid in the form of dividends.
Calculation of dividends
- Dividends are calculated after the determination of thisparameter, as a dividend yield. Dividend yield, in turn, is calculated by the formula: Dividend yield is equal to dividends paid for the last year divided by the company's market value, multiplied by 100%.
- Or you can use another way of howcalculate dividends and dividend yield as follows: dividing dividends from ordinary shares over the past year into the cost of this ordinary share multiplied by 100%.
- Sometimes it is extremely difficult to determine the amount of payment of dividends for the past year - namely, for the period before the closing date of the register, or direct payment of dividends, or for the current year.
- You can also see the advice of analysts inInternet, but, usually, it is better to make such a forecast yourself. It is easiest to make a forecast of the size of dividends and dividend yield on shares not ordinary, but on preferred ones. Usually companies are obliged to pay 10% of the company's profits. This is the mandatory minimum of payments on these shares. It is necessary to divide this 10% share of the company's profits into the available number of preferred shares. This is the minimum that the company will be willing to pay for the share, and usually companies do not pay more than this minimum.
- Sometimes dividends are not taxed. So, such dividends that are accrued in favor of individuals in the form of shares or parts will not be subject to taxation and satisfy such conditions: firstly, this accrual must be static and should not change the size of its parts of all owners fixed in the statutory fund.
- Also, the second condition for the non-taxation of dividends is an increase in the statutory fund for the total nominal value of these accrued dividends.
Taxation of dividends
The work of the tax agent at the time of payment andaccrual of dividends is performed by the issuer of rights of the company or other authorized person on behalf of the issuer, which performs payment or accrual of dividends. Taxation of dividends occurs according to a number of rules:
- Need to withhold and pay taxes withThe company's revenues will be borne by all residents who charge dividends. Also here are those who are on a simplified taxation system, as well as those who are exempt from income taxes for any reason, and indicate which. The dividend tax will be paid at a rate of 15%, it is at this rate that the amount of dividends is, on average, subject to taxation.
- It is worth knowing that the non-resident of the country duringThe payment of income in the form of dividends income tax rates will also amount to 15%. Tax social benefits to income in the form of dividends are not applied, tk. by law, dividends are not considered to be wages.
- So, during the time dividends are accrued,the issuer of the rights of the company will be obliged to withhold taxes from income. Thus, the shareholder - a member of the company company, will be paid the amount of dividends, which will be reduced by the amount of income tax.
- Also, the payment of an advance contribution of the profit tax is not the reason and reason for the non-payment of personal income tax.
Dividends are usually paid after a specialthe decision of the meeting of all the founders of the company, subject to the availability of appropriate financial resources within the timeframes that are determined by this constituent assembly. Although there are a number of nuances:
Now you know how to calculate the dividends and the rules for their accrual. We wish you good luck!