A dividend purportedly made in July 2015 was not actually made until July 2016 when positive action was taken not just to declare the dividend but to allocate it to reduce an overdrawn directors’ loan account and record it in the 2015 accounts, notwithstanding that entries were not inputted into the company’s accounting records until 12 April 2017. 

Summary 

A dividend purportedly made in July 2015 was not actually made until July 2016 when positive action was taken not just to declare the dividend but to allocate it to reduce an overdrawn directors’ loan account and record it in the 2015 accounts, notwithstanding that entries were not inputted into the company’s accounting records until 12 April 2017. 

Background 

The defendants (Mr and Mrs R) were the only directors and shareholders of a company (Rut5) and ran it from its incorporation on 21 February.