Profit distribution refers to the distribution of the net profit realized by enterprises among the state, enterprises and investors in accordance with the distribution form and order stipulated by the national financial system. The object of enterprise profit distribution is the net profit after the enterprise pays income tax. These profits are the rights and interests of enterprises, and enterprises have the right to distribute them independently. According to the law, the distribution order of corporate profits is: paying taxes, making up losses, drawing statutory reserve fund, drawing any reserve fund, and distributing residual profits to shareholders.
What is the distribution order of the company's after-tax profits?
1. Make up the company's losses in previous years. If the statutory reserve fund of the company is insufficient to make up for the losses of the previous year, it shall make up for the losses with the profits of the current year before drawing the statutory reserve fund according to the regulations.
2. Withdraw the statutory provident fund. When the company distributes the after-tax profit of the current year, it shall withdraw 10% of the profit and include it in the company's statutory reserve fund. If the accumulated amount of the statutory common reserve fund of the company is more than 50% of the registered capital of the company, it may not be withdrawn.
3. The shareholders' meeting or shareholders' meeting decides to withdraw the provident fund. After the company withdraws the statutory reserve fund from the after-tax profits, it may also withdraw the reserve fund from the after-tax profits upon the resolution of the shareholders' meeting or general meeting.
4. Pay dividends. After-tax profits of the company after making up losses and drawing provident fund shall be distributed by the limited liability company in accordance with regulations; A joint stock limited company shall distribute shares according to the proportion of shares held by shareholders, except that the articles of association of a joint stock limited company stipulate that shares shall not be distributed according to the proportion of shares held.
I hope the above content can help you. Please consult a professional lawyer if you have any other questions.
Legal basis: According to the provisions of Article 167 of the Company Law, the premium paid by a joint stock limited company for issuing shares at an issue price exceeding the par value of the shares and other income listed in the capital reserve fund as stipulated by the financial department of the State Council shall be listed as the company's capital reserve fund.