Corporations Act 2001
A company does not incur a debt merely by fixing the amount or time for payment of a dividend. The debt arises only when the time fixed for payment arrives and the decision to pay the dividend may be revoked at any time before then.
254V(2) [ Declaration of dividend]However, if the company has a constitution and it provides for the declaration of dividends, the company incurs a debt when the dividend is declared.
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