CandleFocus

Scrips

Candlefocus Editor

Scrips are a type of monetary payment not declared legal tender, though they are accepted in exchange for goods or services. They are commonly issued as a form of credit and used to compensate or pay employees, or in communities when money was not readily available or in short supply. Scrips have been in use since the Roman Empire and are still used today in some countries and communities.

Scrips come in several different forms, including vouchers, certificates, digital tokens, tokens with a specific color or design, and coupons. Gift cards, reward points, and coupons are popular forms of scrips commonly used for purchasing goods and services. These are typically issued by companies to encourage customers to purchase their products. Customers just present their scrips in the store, and the company pays the vendor for the goods or services.

In the business world, companies may also issue scrip dividends. This is when shareholders who own company shares are paid dividends in the form of additional shares. The shareholders now own a bigger portion of the company, as the additional shares represent free ownership of more of the company.

Scrips also have some tax implications for companies issuing them as payments or dividends. Payments made entirely with scrips are sometimes exempt from some payroll taxes. Companies, however, may need to book scrip dividends as actual monetary payments to shareholders including the tax payables.

Scrips have been around for centuries and are still in use today. They come in different forms and are used for a variety of purposes, from payments to employees and customers to shareholder dividends. Companies, investors, and vendors should understand the tax implications in the use of scrips in the business world.

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