Dividend Voucher Template

A dividend voucher is the statement a company gives a shareholder each time it pays them a dividend. It shows the number of shares the payment was calculated on and the amount payable.

Director-shareholders rely on it when reporting dividend income on their self assessment return, and it is the evidence HMRC will ask for if a payment is later challenged. “Dividend voucher”, “dividend confirmation” and “dividend certificate” mean the same thing in practice. Older guidance calls it a tax voucher.

Every time the company pays a dividend, however small, ideally on the payment date so the paperwork stays in step with the money leaving the company bank account. Who declares the dividend depends on its type.

Sole director and sole shareholder? Still produce a voucher for each payment. Missing paperwork is a common reason HMRC recharacterises dividends as salary or a director’s loan.

Every shareholder who is paid a dividend, whoever they are.

• Director-shareholders of an owner-managed company
• Family members or spouses who hold shares, including alphabet shares
• External or minority shareholders
• Corporate shareholders such as a holding company or trust

For jointly held shares, the company pays the first-named holder on the register (Model Articles, reg. 31) and the voucher goes in that name. Shareholders need their copy for self assessment, and accountants will ask for them at year end.

There is no statutory form, but a voucher should always show the following.

• Company name and registered number
• Registered office address
• Shareholder name and address
• Share class (e.g. ordinary, A ordinary)
• Number of shares held
• Dividend per share and total paid
• Record date, when entitlements were fixed from the register
• Date of payment
• A unique voucher number
• Signature of a director or company secretary

Dividends are taxed at their own rates. The first £500 each tax year is tax-free.

Paying without distributable profits

Section 830 of the Companies Act 2006 only allows a dividend out of profits available for distribution. An unlawful dividend can be clawed back, and the directors who approved it may have to repay it personally.

Declaring against out-of-date accounts

The decision must be based on relevant accounts, usually the last annual accounts. If they do not show enough profit, prepare interim accounts first. A company in its first accounting period needs initial accounts.

Skipping board minutes

The voucher records the payment. The board minutes (interim) or shareholders' resolution (final) declare it. HMRC expects to see both.

Paying unequally within a share class

Every share of the same class must receive the same dividend per share. To pay different amounts to different holders, use separate classes such as A and B ordinary shares.

Late dividend waivers

A waiver must be executed as a deed before the dividend is declared or approved. Once declared, the dividend is a debt due by the company and a later waiver does not avoid the tax charge.

Backdating vouchers

Date the voucher on the actual payment date. A dividend is taxed in the tax year it becomes payable, not the year it is declared. Backdating to fit a different tax year is a common red flag in HMRC enquiries.