Topic:Dividend out of the free reserves ?
AnonymousPosted on 8th January,2021 05:15 PM
If a company wants to issue dividend out of the free reserves. And it does not paid any dividend to the shareholders for preceeding financial year. So what amount can be drawn for the purpose of paying dividend by that company.\r\n
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BMC Associates says Replied on 16th May,2026 10:28 AM
f a company wants to declare dividend out of free reserves, it must comply with the Companies (Declaration and Payment of Dividend) Rules, 2014. As explained by experienced chartered accountant firms in Gurgaon, if the company has not declared any dividend in the preceding financial year or in the previous three financial years, then it cannot declare dividend out of free reserves. A professional chartered accountant Gurgaon can help companies understand the legal conditions relating to dividend declaration, reserves utilization, and Companies Act compliance. Many businesses consult a CA firm in Gurgaon or a qualified CA in Gurgaon to ensure proper compliance before distributing dividend from accumulated reserves.
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