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sir cumulative- irredeemable preference shares are considered as a debt, right? With their interest cost(or rather dividend payment) is tax-deductible ?
and what about non-cumulative preference shares, debt or equity?
It makes no difference whether the preference shares are cumulative or not.
Irredeemable preference shares are treated as equity in financial accounts.
Redeemable preference shares are treated as non-current liabilities, and the dividend is teated as a finance costs.
In neither case are the dividends tax allowable.
This all financial accounts rather than AFM.
sir but in case of redeemable preference shares which are treated as non-current liabilities, won’t the dividends be similar to interest costs and hence tax deductible?
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