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please, in the lecture note, practice question number 23 states item dividend as
Dividends received from UK companies (non associated). but the answer given treated non associated company as associated i.e it says “Upper limit 1,500,000 ÷ 2 (Sail Ltd plus one associated company) = £750,000 reduced upper limit”
my understanding is that upper limit can only be scaled down when there is associated company. and in the question it says non associated UK company`s dividends.I hope i am not missing something
I regret that are you are “missing something”. The question states that the company does have one associated company and hence the calculation of the revised lower profit limits.
That statement however does not mean that the company does not also own shares in other companies where the shareholdings are less than 51%. It is then from those minority shareholdings that the dividends are received. You have to be told this information as we of course only include in the FII calculation dividends received from non associated companies.
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