For foreign fully franked dividend, does the corporate tax paid overseas give rise to a tax credit here in Australia?
Under Malaysia's single-tier tax system, dividends are not taxed in the hands of the shareholder, as the distributing company has already paid a 24% corporate tax. Consequently, these dividends are tax-free and do not reflect franking credits in the dividend statement.
When reporting this income in the Australian Tax Return, how can we claim the franking credit for the 24% tax paid by the Malaysian company? Is it sufficient to calculate the 24% tax paid by the company, or must taxpayers provide a dividend statement showing the franking credits? In the absence of franking credits, would this result in double taxation on the dividend income?
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