Conduit foreign income

If you are an Australian corporate tax entity who receives (directly or indirectly) conduit foreign income, you may declare some or all of a frankable, unfranked distribution to be conduit foreign income to the extent the entity has conduit foreign income. If you make the distribution to:

  • a non-resident member, the portion declared to be conduit foreign income is exempt from withholding tax.
  • another Australian corporate tax entity, that corporate tax entity may pass on that conduit foreign income to its members - so, the distribution statement must specify the portion of the unfranked part of the distribution that is declared to be conduit foreign income.

If an individual resident member receives a distribution declared to be conduit foreign income, that distribution is treated like any other unfranked distribution.

Further Information

For more information on conduit foreign income, refer to Taxation of trust net income - non resident beneficiaries: General overview of the changes.

End of further information
    Last modified: 19 Oct 2012QC 16679