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Re: Franking Credits and Final Tax Return

Newbie

Views 89

Replies 3

A client will wind down its operations and lodge a final tax return in 2022 Financial year.

Operations will cease about September Quarter.

 

There will be tax payable, the extent of tax due for 2022, can a franked dividend be paid in September?

Currently, there are no credits available in the franking account balance.

 

Or do I need to wait til 30 June to declare and pay?

 

 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee Registered Tax Practitioner

Replies 2

A client will wind down its operations and lodge a final tax return in 2022 Financial year.

Operations will cease about September Quarter.

 

There will be tax payable, the extent of tax due for 2022, can a franked dividend be paid in September?

Currently, there are no credits available in the franking account balance.

 

Or do I need to wait til 30 June to declare and pay?

 

Company can frank dividends to the extent that the franking account 

will have a balance =  0 or more by 30 June of the year in which the dividend is paid.

 

This means that franking is OK as long as enough tax is paid during the year to cover the franking.

 

3 REPLIES 3

Most helpful response

Devotee Registered Tax Practitioner

Replies 2

A client will wind down its operations and lodge a final tax return in 2022 Financial year.

Operations will cease about September Quarter.

 

There will be tax payable, the extent of tax due for 2022, can a franked dividend be paid in September?

Currently, there are no credits available in the franking account balance.

 

Or do I need to wait til 30 June to declare and pay?

 

Company can frank dividends to the extent that the franking account 

will have a balance =  0 or more by 30 June of the year in which the dividend is paid.

 

This means that franking is OK as long as enough tax is paid during the year to cover the franking.

 

Newbie

Replies 1

Thanks for that.

Im more specifically asking

can I physically pay a franked dividend (franking credits upto the estimated tax for 2022*) in the tax period ie pay it in Nov 21, when the tax is physically paid after 30 June 2021

 

*i say estimated, its actual as its final year of trade

Devotee Registered Tax Practitioner

Replies 0

Im more specifically asking

can I physically pay a franked dividend (franking credits upto the estimated tax for 2022*) in the tax period ie pay it in Nov 21,

when the tax is physically paid after 30 June 2021

 

Yes, just don't have the franking account overdrawn at year end.