Profit distributing – Legal-Glossary

Profit distributing – this legal term is used within the Company Law. It details the process of sharing the net profit of the company, among its shareholders/owners. Usually this is done only after the related expenses are met and due taxes are paid to the local Authorities – which reduces the initial, gross profit. Normally companies share profit on annual basis (i.e. at the end of the financial year). In some jurisdictions the net profit and the profit sharing are published in the public registers of the Companies House, in order to show ot interested parties the actual financial standing of the company.