Add a dividend income workpaper

Overview

Dividend income workpapers can be added to accounts in the trial balance that contain dividend income. The workpaper helps to correctly record and disclose income, and claim dividend withholding tax (DWT) and imputation credits.

Add a dividend income workpaper to an account

1. From the entity's tax year summary, in the navigation bar select Workpapers > Accounts.
2. If the Accounts screen opens (this happens when there is more than one data source), select Trial balance.
3. On the Trial balance screen, locate the account that you want to add the workpaper to, and in the Workpaper column, select Add workpaper.
4. From the Add workpaper drop-down, select Dividend income. This will add the workpaper to the account and create a link to it directly from the trial balance.
5. From the Trial balance, select Dividend income to open the workpaper.  

Workpapers can also be added directly to an entity.

Add information to the workpaper

Once within the workpaper, the basic workpaper features are accessible, such as queries, notes and files.

The second half of the workpaper contains the features specific to dividend income:

Tax Treatment: tag the dividend as either taxable or exempt income.

Paid: the date the dividend was paid out. Will default to the last day of the financial year.

Gross dividend: Enter the gross amount of the dividend including imputation credits and resident withholding tax (RWT). If the dividend income in your trial balance is net of RWT and/or Imputation Credits it will need to be grossed up to include these, by selecting the pencil icon and editing the gross dividend amount.

Less Imputation Credits: enter the total imputation credits attached to the gross dividends.

Less Resident Withholding Tax: enter the total RWT attached to the gross dividends.

Net Dividend: this will calculate as gross dividend less imputation credits and RWT.

Plus Tax Paid Trustee Income: this box is specifically for items such as electricity dividends (e.g. the EnTrust dividend received by Auckland ratepayers). If there is a line on your dividend statement that refers to tax paid trustee income enter it here, but continue to enter imputation credits and RWT into the boxes above as usual.

Net Income: this will calculate as net dividend plus tax paid on trustee income.

Troubleshooting and FAQs

Dividend income doesn't have imputation credits attached to it in the trial balance

Follow the instructions above to edit the gross dividend income to include any imputation credits in the workpaper.

Dividend income trial balance account contains some overseas income

Inland Revenue (IR) requires foreign dividends to be disclosed in the tax return as foreign income, not NZ dividend income. To do this, either add a breakdown and then add a foreign dividend workpaper to the account, or create a separate account in your trial balance for foreign dividends, and add the foreign dividend workpaper.

Dividend income is in both prefill and the trial balance

We recommend either not bringing in prefill, or adding a permanent different workpaper instead of an dividend income workpaper to the account so it is not returned as income twice.

Related Articles

Understanding workpapers

Add a file to an entity

Add a query or note

View the income tax position

Add or remove a breakdown

Add foreign income