Accountants' guide to client dividends in QuickBooks Online (UK)

This guide is for practices and bookkeepers. It is general information, not tax or legal advice. Whether a dividend is lawful, and how it should be taxed, depends on each client's accounts and articles, so apply your own professional judgement.

For a client on QuickBooks Online, set the company up once: connect its QuickBooks company, confirm the financial-year end, choose the bank and dividends equity accounts, and match each shareholder to an existing supplier. Then run each dividend inside that client, review the expense and attachment it posts, and diarise the reconnect for about every 100 days.

For clients on Xero, the companion is the accountants' guide to client dividends in Xero.

What changes when the client is on QuickBooks

The paperwork doesn't change. GOV.UK says that for each dividend payment the company "must write up a dividend voucher" and that "You must give a copy of the voucher to recipients of the dividend and keep a copy for your company's records". It also requires a directors' meeting to declare the dividend, with minutes, "even if you're the only director" (GOV.UK). See the dividend voucher guide and the board minutes template.

The bookkeeping does. With Dividendly connected, a QuickBooks client differs from a Xero client in five ways:

• What gets posted: a Purchase (an expense) with a No VAT line in QuickBooks; a SPEND transaction in Xero.
• Who it's paid to: a QuickBooks Vendor, which the UK interface calls a supplier; a contact in Xero.
• Deleting a posted voucher: the Purchase is permanently deleted in QuickBooks; the Xero transaction is voided.
• Financial year: you confirm the year end when you connect QuickBooks; Xero's is read from the organisation.
• Connection lifetime: QuickBooks needs reconnecting roughly every 100 days; Xero's connection refreshes on a rolling basis.

The QuickBooks vs Xero comparison sets these side by side if you're advising a client on which to use.

One process across a mixed client book

Most practices have clients on Xero, on QuickBooks and on spreadsheets. In Dividendly each client is a separate company with its own connection, or none, and its own shareholders, accounts and settings. Data doesn't cross between them.

Every upcoming run produces the same documents, whichever software the client uses: a voucher, board minutes, and a dividend declaration (interim) or shareholder resolution (final), with an e-signature acknowledgement step and email delivery to each shareholder. Back-filled and manual vouchers are the voucher PDF only, with no minutes and no email. Clients with no accounting software run documents-only, and you post their entries by hand.

Each company connects to one provider at a time. Moving a client from QuickBooks to Xero means disconnecting one and connecting the other. For the Xero side of the book, see the Xero integration guide and the guide to recording dividends in Xero.

One limit to know before you roll it out: there is no dashboard that queues runs across several clients. You switch into a client, run its dividends, then move to the next.

Setting up a QuickBooks client

Work through these once per client. The setup checklist on the Dividendly dashboard follows the same order.

1. Connect the client's QuickBooks company

You sign in to Dividendly with a magic link or Sign in with Xero. There is no Sign in with Intuit: QuickBooks is connected from inside the company, through Intuit's authorisation screen. Dividendly asks for a single scope, com.intuit.quickbooks.accounting.

The person who authorises needs the right access. Intuit's UK help says "Only QuickBooks Online Admin users can connect and manage apps for their company or firm" and that "for QuickBooks Online Accountant Firms, only Firm owners can connect and manage apps for a client" (Intuit). If nobody at the practice has admin rights in the client's company, arrange the connection with the client.

2. Confirm the financial-year end

QuickBooks stores only the month a financial year starts, so Dividendly asks you to confirm the year-end date when you connect. Check it against the accounting reference date at Companies House before you accept it. Dividendly uses it for the company's financial-year dates.

3. Choose the bank and dividends accounts

Pick the bank account dividends are paid from and the equity account they're coded to. Every posting for that client uses this pair. If the client has no dividends account yet, add one before you connect. Using the same account name across every client keeps your year-end review the same from file to file. The guide to recording dividends in QuickBooks Online covers setting up the account.

4. Match shareholders to existing suppliers

Each shareholder is mapped to the QuickBooks Vendor they're paid as. Dividendly doesn't create vendors. If a shareholder isn't set up yet, add them in QuickBooks first; Intuit's UK steps are "Go to All apps, select Expenses & Bills, then select Suppliers", then "Select New supplier" (Intuit: add and manage suppliers).

Check the mapping one shareholder at a time. A shareholder mapped to the wrong supplier gets a correct voucher, posted against the wrong payee.

5. Record the share structure

Enter the company's total shares and each shareholder's holding. Upcoming runs split the total by the number of shares each person holds. The share class is printed on the voucher, but it doesn't change the split. A client that pays different rates on different classes needs a manual voucher per shareholder, with the payment recorded in QuickBooks by hand.

6. Set the document defaults

Choose per client which documents each run produces (voucher, board minutes, and the declaration for interim or the resolution for final dividends), and add the client's header or footer to the PDFs if they want it.

Recording and reviewing dividend payments in QuickBooks

When you run an upcoming dividend for a connected client, Dividendly drafts the documents for each shareholder and posts one Purchase per shareholder to the chosen bank and dividends account, with a No VAT line and the PDFs attached.

It doesn't move money and it doesn't match bank feed lines. The client still pays each shareholder from the bank, and someone still matches that bank line to the expense already posted, rather than adding a second one.

A short review after each run catches most problems:

• Open the dividends account from the chart of accounts and run its report for the period.
• Check each new expense: payee, date, amount, the No VAT line, and that the voucher PDF is attached.
• When the bank line arrives, match it to the existing expense.
• Look at voucher history in Dividendly. It shows each run's timeline, and failed or partly completed runs have a retry action.

Some clients credit dividends to a director's loan account instead of paying them from the bank. That is a journal you post yourself. Dividendly posts bank payments only, and back-fill won't find journal entries later.

Year-end review and catching up

The year-end checks

Before the accounts are finalised, check each QuickBooks client for:

• Totals that agree: the dividends account for the year equals the total of the vouchers, which equals the total in the minutes.
• Tax years on vouchers: shareholders are taxed by the tax year a dividend is paid in (6 April to 5 April), which rarely lines up with the company's year, so check each voucher shows the right one. HMRC's manual says a dividend is not paid "unless and until the shareholder receives money or the distribution is otherwise unreservedly placed at the shareholder's disposal, for instance by being credited to a loan account on which the shareholder has power to draw" (HMRC CTM15205).
• Distributable reserves: a company "may only make a distribution out of profits available for the purpose" (Companies Act 2006 s.830), judged by the relevant accounts under s.836. That judgement is yours. Dividendly doesn't check reserves or whether a dividend is lawful.
• Miscoded dividends: payments coded to drawings, wages or a suspense account. Intuit's reclassify transactions tool, in QuickBooks Online Advanced and QuickBooks Online Accountant, moves several at once, but it can't change the bank account used for expenses (Intuit). Think twice before recoding a year whose accounts are already filed.

Once the year is signed off, set a closing date. Intuit says only a primary admin or company admin can change it, under Settings, Account and settings, Advanced, then Accounting, and that the Exceptions to Closing Date report shows any changes made after the books were closed (Intuit).

Catching up on a new client's past dividends

New clients often arrive with dividends in QuickBooks and no paperwork. Historical back-fill reads past Purchases in a date window you choose, keeps those coded to the client's dividends account, and drafts a voucher for each. It posts no new transaction. It needs a connected Xero or QuickBooks account and is included on Growth, Accountant and Enterprise.

Before you run it:

• Recode any past dividends sitting in other accounts, or back-fill won't find them.
• Make sure each past payment names the shareholder's supplier as payee.
• Remember that dividends credited by journal won't appear.

On each back-filled voucher, the payment date comes from the transaction, which is a fact about the payment, and the reference is generated from the transaction. If you add the e-signature acknowledgement, date it the day it's actually signed. Check every field in the PDF preview before you generate. If any field isn't right, issue that voucher with the manual voucher flow instead, where you enter the fields yourself. Back-fill drafts vouchers only, so minutes recording past dividends are written separately and dated when they're written. The guide to missing dividend vouchers covers dating and the evidence to gather.

The 100-day reconnect across a client book

Intuit's refresh tokens expire. Dividendly tracks each QuickBooks connection's expiry and shows a reconnect prompt before it lapses, roughly every 100 days. Reconnecting takes a few seconds and nothing is lost.

Across a client book, three things make it routine:

• Diarise it per client. The prompt appears inside each client's company, so note the connect date in your practice diary or client list.
• Know who can reconnect. Reconnecting goes through Intuit's authorisation again, so it needs an admin user. If that's the client, book it with them.
• Reconnect before a run date, not after. If a connection does lapse, reconnect it, then use voucher history to retry any run that failed.

Xero clients don't need this. Their connection refreshes on a rolling basis.

Deleting a voucher is permanent in QuickBooks

Generated vouchers can't be edited. To correct one, delete it and issue a new one. What deleting does in QuickBooks depends on how the voucher was made:

• From an upcoming run: Dividendly posted a Purchase, and deleting the voucher permanently deletes that Purchase and its attachment. Dividendly can't void a QuickBooks Purchase (QuickBooks doesn't let apps void one). Intuit's help says that "Once a transaction is deleted in QuickBooks Online, it can't be restored", though the Audit log keeps its details (Intuit).
• Back-filled or manual: Dividendly posted nothing, so deleting the voucher changes nothing in QuickBooks.

You're asked to confirm before anything is deleted. If the payment has already been matched to the bank feed, or sits in a period you've closed, speak to whoever owns the client's books before deleting. For Xero clients the equivalent transaction is voided, not deleted.

Access and security

• Scope: one scope, com.intuit.quickbooks.accounting. Dividendly doesn't read payroll or payments.
• Tokens and documents: accounting connection tokens are encrypted at rest (AES-256-GCM) and voucher PDFs live in private storage behind expiring links.
• Separation: access is default-deny and scoped to each company, so one client's data never appears in another's.
• Intuit review: Intuit reviewed Dividendly's security questionnaire before issuing production keys, and every Intuit API error is logged with Intuit's intuit_tid so support can trace it.
• Revoking: an admin can disconnect Dividendly from the client's connected apps in QuickBooks at any time, and Dividendly disconnects itself if the subscription is cancelled.

The security page lists the scopes for both providers.

What to tell clients

Set expectations with each client at the start:

• What shareholders receive. On an upcoming run, each shareholder gets their documents by email after the e-signature acknowledgement step. A copy stays in voucher history and the PDF is attached to the expense in QuickBooks.
• What appears in their books. One expense per shareholder in the dividends account, with the voucher attached.
• Back-filled vouchers. They aren't emailed automatically. Download them from voucher history and send them on, so each shareholder has a copy as GOV.UK requires.
• Reconnects. If the client is the QuickBooks admin, you'll need them about every 100 days.
• Self Assessment. GOV.UK notes that shareholders "may have to pay Income Tax if they're over £500". The vouchers for the tax year give them the figures to report. The dividend tax guide explains the bands.

What Dividendly doesn't do

• Queue runs across several clients from one screen.
• Create suppliers in QuickBooks.
• Pay shareholders, or match payments to the bank feed.
• Check distributable reserves, lawfulness or tax.
• Draft dividend waivers or share certificates, keep statutory registers, or file anything with Companies House or HMRC.
• Connect to QuickBooks Desktop, or to companies outside the UK.

Plans for practices

The Xero and QuickBooks integrations, and documents-only mode, are included on every plan at no extra cost. Accountant covers up to 10 client companies with up to 25 shareholders per company, and includes historical, upcoming and manual workflows. Enterprise removes the caps. Every paid plan starts with a 7-day free trial. See pricing for the full comparison and the page for accountants for how practices use it. The QuickBooks Online integration guide walks through the connection in more detail.

FAQ: client dividends in QuickBooks Online

Does Dividendly create suppliers in QuickBooks?

No. It maps each shareholder to an existing QuickBooks Vendor, which the UK interface lists under Suppliers. Add any missing shareholder in QuickBooks before you map them.

Can I connect a client through QuickBooks Online Accountant?

Dividendly connects to the client's own QuickBooks company. Intuit says only admin users can connect apps, and that for QuickBooks Online Accountant firms only firm owners can connect apps for a client. If that isn't you, the firm owner or the client's admin needs to authorise it.

Does it work with QuickBooks Desktop?

No. Dividendly works with QuickBooks Online only, for UK companies.

Can I back-fill vouchers for a client who joins mid-year?

Yes, if the client is connected and on Growth, Accountant or Enterprise. Back-fill reads past Purchases on the dividends account in the date range you choose. Dividends credited by journal won't appear, so issue those as manual vouchers.