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Re-Claiming withholding tax for NZ dividend payer

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Newbie

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Hi 

 

We currently hold 10,000 shares of Michael Hill International Ltd (MHJ.AX) via our SMSF. The company has a dual-listing in Australia and New Zealand although we bought shares in the Australian listed component.

 

Earlier this year, a dividend of A$250 was paid out on these shares; however, we only received A$132.67 because of A$117.33 of withholding tax. The statement also indicates that there are no Australian franking credits but NZ$100.39 worth of NZ imputation credits.

 

Is there any way to reclaim either/both of (1) A$117.33 withholding tax or (2) NZ$100.39 worth of NZ imputation credits for an Australian domiciled SMSF?

 

Thanks in advance for any help - 

 

Ina

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ATO Certified Response

Community Support

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Hi @Ian88

 

Welcome to our Community.

 

Regarding the tax that has been withheld from the dividend, @macfanboy is correct. Assuming the tax was withheld due to not quoting your self-managed super fund's (SMSF's) TFN or ABN (which is what it sounds like), you can claim it on the SMSF return.

 

For more information on how to do that, refer to the H3 Credit for tax withheld – where ABN or TFN not quoted (non-individual) question of the Income tax calculation statement section of the Self-managed superannuation fund annual return instructions 2019 page on our website.

 

Regarding the New Zealand imputation credit, your SMSF can't claim it. If you refer to E1 Complying fund’s franking credits tax offset, you will see that it specifically states that you do not include New Zealand imputation credits (an Australian resident cannot claim New Zealand imputation credits).

 

You can include Australian franking credits that are attached to a New Zealand franking company's franked non-share dividends and assessable franked dividends. Of course that isn't applicable in this scenario as you have mentioned that there were no Australian franking credits.

 

Hope this helps.

 

Thanks,

 

ChrisR

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ATO Certified Response

Taxicorn

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The withholding tax can be claimed when you lodge your tax return. It was withheld because you didn't provide your tax file number.

You need to let them know to prevent more being withheld.

 

In regards to the NZ imputation credits, more information would be needed to give an answer

 

https://www.ato.gov.au/business/imputation/in-detail/trans-tasman-imputation-special-rules/

 

Where a supplementary dividend has been paid and the taxpayer is entitled to a foreign income tax offset because of the inclusion of the franked dividend in their assessable income, the gross dividend and Australian franking credit amounts will need to be adjusted. Amounts reported at Items 20E and 20M of the tax return must be increased by the amount of the supplementary dividend. The Australian franking credit reported at Item 20F must be reduced by the amount of the supplementary dividend.

 

The above link should help.

 

 

Highlighted

Most helpful response

ATO Certified Response

Community Support

Replies 0

Hi @Ian88

 

Welcome to our Community.

 

Regarding the tax that has been withheld from the dividend, @macfanboy is correct. Assuming the tax was withheld due to not quoting your self-managed super fund's (SMSF's) TFN or ABN (which is what it sounds like), you can claim it on the SMSF return.

 

For more information on how to do that, refer to the H3 Credit for tax withheld – where ABN or TFN not quoted (non-individual) question of the Income tax calculation statement section of the Self-managed superannuation fund annual return instructions 2019 page on our website.

 

Regarding the New Zealand imputation credit, your SMSF can't claim it. If you refer to E1 Complying fund’s franking credits tax offset, you will see that it specifically states that you do not include New Zealand imputation credits (an Australian resident cannot claim New Zealand imputation credits).

 

You can include Australian franking credits that are attached to a New Zealand franking company's franked non-share dividends and assessable franked dividends. Of course that isn't applicable in this scenario as you have mentioned that there were no Australian franking credits.

 

Hope this helps.

 

Thanks,

 

ChrisR