The decision has allowed Courts to increase its payment to shareholders by 36 per cent to 5p a share.
FIDs were devised to reduce companies' liability to advance corporation tax and are suited to companies, like Courts, which earn substantial profits overseas.
However, they are not universally popular. Non-taxpaying shareholders such as pension funds cannot reclaim tax as with ordinary dividends.
Courts said that the large increase in the dividend was partly made to compensate non-taxpaying investors.
The company's underlying profits rose 22 per cent to pounds 24m in the year to 31 March. However, it earned another pounds 9.5m when it sold shares in its Singapore subsidiary. Pre-tax profits advanced to pounds 22m from pounds 14.2m.
Most of Courts' trading profit is earned overseas where it sells electrical goods such as televisions. It has shops in India, South-east Asia, Pacific rim countries and the West Indies. Total profits from overseas were 16 per cent up at pounds 22.6m.
In the UK, rising consumer expenditure drove a 75 per cent profit increase. Operating profit was pounds 3.9m against pounds 2.2m on sales up 7 per cent at pounds 111m.Reuse content