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Re: Tax on franked dividends

Newbie

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If "franked dividends" are paid out at a percentage of 100% for a company listed on the Australian Stock Exchange, these are already taxed by the respective companies. However, what needs to be considered if this percentage is below 100%? In this case, is the withholding tax rate reduced or is the taxable income reduced?

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Most helpful response

Taxicorn

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@JustinMes 

 

It just means that you willreceive a lower Franking Credit.

 

All Dividend income is entered into a tax return and you pay tax on it.

The Franking credit gives you a partial payment on that tax.

Even better is when you don't have to pay any tax and therefore receive this as a refund.

1 REPLY 1

Most helpful response

Taxicorn

Replies 0

@JustinMes 

 

It just means that you willreceive a lower Franking Credit.

 

All Dividend income is entered into a tax return and you pay tax on it.

The Franking credit gives you a partial payment on that tax.

Even better is when you don't have to pay any tax and therefore receive this as a refund.