Tag: Deemed dividend
Dividend is a transfer of value from the company to a shareholder resulting from the shareholding relationship. Dividends are sometimes “deemed” to have been paid. Any transfer of services or assets by a company to a shareholder (or their associate) for less than market value will give rise to a taxable deemed dividend.
Deemed dividend may arise in these situations:
* excessive remuneration paid to a shareholder-employee
* interest-free or low-interest loans
* transfers of property for below-market value
* rental below market value.