Simplified imputation - overview of the imputation system

This fact sheet provides an overview of the simplified imputation system. It also contains links to other fact sheets in the series on imputation.

Key points

  • The simplified imputation system took effect from 1 July 2002 and changes the mechanics of the former imputation system but generally achieves the same outcome as the former system.
  • The franking account operates on a tax-paid basis and is also now a rolling-balance account.
  • The introduction of franking periods enabling corporate tax entities to align the period for determining their franking deficit tax liability with their income year.
  • Corporate tax entities will be able to choose the extent to which they frank a distribution. This choice though, is subject to the benchmark rule.
  • The benchmark rule replaces the 'required franking amount' rules and while similarly limiting streaming opportunities, provides greater flexibility in allocating franking credits to frankable distributions.
  • The gross-up and credit approach replaces the intercorporate dividend rebate for companies in receipt of franked distributions.

Status and changes

This fact sheet replaces a previous fact sheet published on 11 July 2002.

    Last modified: 28 Jul 2016QC 16618