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Am finishing off my T2 return. But the T2 retained earnings are much lower than my books. Difference is the amount the T2IB software has included as a carryforward in the Capital Dividend Account (Just sold client lists and real estate). Business continues.
Dividends have not yet been declared. Should I simply show the amount on the S100, using GIFI 2962 (dividends payable) until such time as the dividends are actually declared and paid?
Thanks,
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Capital Dividend Payable Balance Sheet entry?
MultiQuote#2 Guest_snowplowguy_*
Posted 05 January 2008 - 11:19 PM
The CDA is a lifetime accumulation of the non-taxable portion of net gains. It increases over time with capital gains and decreases with capital losses but does not, in itself, have any effect on the T2 schedule 100.
Dividends that have not been declared are not really anything..... thus would have no effect on the T2 or the F/S.
If you are thinking of paying out your CDA account then elections, calculations, and director's resolutions authorizing such dividends must be prepared and submitted to the appropriate taxation authority.
I don't see your situation causing a variation in the R/E between F/S and T2. Many corporations have a positive CDA balance.
Dividends that have not been declared are not really anything..... thus would have no effect on the T2 or the F/S.
If you are thinking of paying out your CDA account then elections, calculations, and director's resolutions authorizing such dividends must be prepared and submitted to the appropriate taxation authority.
I don't see your situation causing a variation in the R/E between F/S and T2. Many corporations have a positive CDA balance.
#3
David Blue 
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Posted 07 January 2008 - 04:29 PM
Lilly, on Jan 5 2008, 10:04 PM, said:
Am finishing off my T2 return. But the T2 retained earnings are much lower than my books. Difference is the amount the T2IB software has included as a carryforward in the Capital Dividend Account (Just sold client lists and real estate). Business continues.
Dividends have not yet been declared. Should I simply show the amount on the S100, using GIFI 2962 (dividends payable) until such time as the dividends are actually declared and paid?
Thanks,
Dividends have not yet been declared. Should I simply show the amount on the S100, using GIFI 2962 (dividends payable) until such time as the dividends are actually declared and paid?
Thanks,
Please remember the timing reporting requirements for the CDA.
If your amount RE are out of balance look at the previous years carry forwards on the S100. Could this amount be out ?
This has happened in the past when a client posts an entry directly to the retained earnings account in error. Might be worth taking a look at.
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