What are interim dividends and how are they payable?

Interim Dividend

Sometimes dividend is declared by directors between two AGMs which is called an Interim Dividend. As the name goes,

it is a dividend declared and paid during the intervening period between two AGMs 

Payment Procedure 

Open an Interim Dividend Account with the bank as resolved by the board and deposit the amount of dividend payable in the account within5days of declaration of dividend. 

Prepare a statement of dividend in respect of each shareholder containing the details of name and address of the shareholders, number of shares held, amount of dividend payable along with their bank account details (for online transfer). 

Ensure dividend tax is paid to the tax authorities within prescribed time, as detailed below. 

Dispatch dividend warrants within30 days of the declaration of dividend. 

Arrange for transfer of unpaid or unclaimed dividend to a special account named “Unpaid dividend A/c” within7 days after expiry of the period of30 days of declaration of dividend. 

Any Money transferred to the unpaid dividend account of a Company which remains unpaid or unclaimed for a period of seven years from the date of such transfer shall be transferred to Investor Education And Protection Fund (IEPF) 

Interim Dividend is the distribution of profits to shareholders before a firm's annual earnings have been computed, or at any time between two successive annual general meeting (AGM).

Payment: Interim dividend is generally paid quarterly or half-yearly. 

A dividend payment made before a company's AGM and final financial statements. This declared dividend usually accompanies the company's interim financial statements.