- Date : 04/12/2022
- Read: 2 mins
Difference between interim and final dividend
A dividend is an added benefit paid by the company either in cash, reward or otherwise to the shareholders. It can be issued as a cash payment, in the form of stock, or in any other manner. It is usually a part of the company’s profit which it shares with the shareholders.
When it comes to cash dividends, there are two types - interim dividends and final dividends. Let's understand what they are and how they differ from one another.
Interim dividend - the concept
An interim dividend is one that is paid before conducting the AGM (Annual General Meeting) of the company and before the company’s financial statements are released.
Final dividend - the concept
A final dividend is announced by the Board of Directors after preparing and issuing the company's annual financial statements. The final dividend is generally announced in the company’s Annual General Meeting.
Related - Know the difference between capital gains and dividend income
Difference between interim and final dividend
Although interim and final dividends are paid to the shareholders as a return on their investment, there is some key difference between them. Let's have a look:
The bottom line
Both interim and final dividends pay returns on shareholders' investments. However, they are worlds apart. So, understand the meaning and difference between these dividends to know what your stock investments are yielding.
Related - Know about the taxation of dividend
