Dividends are payments to the companies shareholders out of the companies profits.
To record dividends in your KashFlow account you need to first create a transaction type (nominal code) that is set as a Capital & Reserves code
To do that, go to Settings > Chart of Accounts.
At the bottom of the screen, create the new transaction type
- Code – the nominal code you want to use
- Name – Dividends
- Type – Capital & Reserves
- Area – Bank Transaction Type
When ready, click the Add New Code button
Recording a Dividends Payment
To record a dividends payment go to Bank > View/Add Transactions> Add New Transaction.
- Date – this needs to be the date the money left the company bank account to pay the dividends
- Comment – use this record a note about the transaction, i.e. “Quarter 2 Shareholder Dividends”
- Code – select your new Dividends code
- In/Out – as it’s money that’s left your account this should be entered as a money out transaction
- VAT Rate – this should be N/A
- VAT Amount – this should be 0.00
The transaction will now show in the correct place on your Balance Sheet Report.