A Guide on Dividends in Ireland
A Guide on Dividends in IrelandUpdated on Sunday 19th February 2017
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Dividends represent a proportion of the company’s earnings which are distributed to the shareholders in accordance with the decisions of the company’s board. Dividends can be provided to the company’s founders as cash, stocks and other forms of assets belonging to the company. Our team of Irish lawyers can assist investors with more information on the legal aspects concerning the distribution of dividends in Ireland.
The distribution of dividends in Ireland
As a general rule, a part of the company’s earnings are kept in the company in form of dividends, which are then distributed, following specific regulations, to the shareholders.
The issuance of dividends is established in accordance with the wishes of the company’s directors, but only if the company’s statutory documents provide regulations in this sense. Companies may declare dividends if the memorandum or the articles of association provide specific provisions, on which our team of lawyers in Ireland can offer more details.
A company in Ireland can issue interim dividends and final dividends. The value of the dividend is established by the company’s directors and, further on, the decision must be approved by the members of the board.
When can dividends be distributed in Ireland?
It is important to know that companies in Ireland can distribute dividends only in the situation in which the business incurs financial profits. They are calculated taking into account the net profits of the company in a financial year.
Foreign investors should know that not all shareholders are entitled to receiving dividends in a company in Ireland. However, those who can receive payments in the form of dividends may be entitled to such payments only after the dividend has been declared.
In the situation in which an entitled shareholder does not receive its return on investment, he or she may take legal action against the company’s representatives.
Businessmen interested in receiving legal advice on the Irish dividends are invited to contact our law firm in Ireland for assistance.