Section C

Warning:

This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

End of attention

Significant variation in benchmark franking percentage

For a corporate tax entity that is a private company, a franking period is the same as its income year.

For corporate tax entities that are not private companies, there are ordinarily two franking periods in an income year. The first franking period is the first six months beginning at the start of the entity’s income year; and the second franking period will be the remainder of the income year.

Was there a significant variation in benchmark franking percentage between franking periods?

Where a corporate tax entity has a significant variation in its benchmark franking percentage between franking periods, it has an obligation to disclose this information to the Commissioner (unless it is a listed public company that satisfies certain criteria, or is a 100% subsidiary of such a company).

See also:

• Benchmark rule
• Applying to depart from the benchmark rule

A significant variation occurs where the benchmark franking percentage for the current franking period has increased or decreased by more than 20 percentage points for each franking period. The time frame for determining whether a significant variation has occurred starts immediately after the last franking period in which a frankable distribution was made (the last relevant franking period) and ending at the end of the current franking period.

• A corporate tax entity may apply for permission to depart from the benchmark rule. The application must be in writing and a departure will only be permitted in extraordinary circumstances that would be unforeseeable and beyond the control of the entity, its members and controllers. The approval of the Commissioner must be obtained before the entity lodges the franking account tax return with the altered franking percentage.
• For a corporate tax entity that makes a frankable distribution in every franking period, the effect of the above formula is that a significant variation will occur where the benchmark franking percentage increases or decreases between franking periods by more than 20 percentage points.
• Examples 6 and 7 will help you to work out whether there was a significant variation in your entity’s benchmark franking percentage between franking periods.

If there was a significant variation, print X in the Yes box at Was there a significant variation in benchmark franking percentage between franking periods? on the Franking account tax return 2021. Complete the rest of section C.

• For the purposes of recording the benchmark franking percentage at G to J, the value stated should be worked out to two decimal places, rounding up if the third decimal place is 5 or more.
• Listed public companies that satisfy the criteria set out in subsection 203-20(1) of the ITAA 1997, and 100% subsidiaries of such companies, do not need to complete section C.

If there was no significant variation, print X in the No box at Was there a significant variation in benchmark franking percentage between franking periods? on the Franking account tax return 2021. Do not complete the rest of section C.

Payment slip

On the payment slip provided, print your entity’s name, tax file number (TFN) and Australian business number (ABN). In the Amount payable box, write the amount you recorded at section B, E Total tax payable. This is the amount of FDT and OFT that is to be paid. See Lodgment and payment requirements for details on how to pay this amount.

Declaration and other information

Signing this tax return

The law requires that an authorised person signs this tax return. An authorised person for this purpose may be the public officer of the company or an agent duly authorised by the company.

Where an agent provides this tax return and accompanying information (where applicable), the company must prepare, and give to the agent, a signed declaration stating that:

• the company authorises the agent to give this tax return and accompanying information (where applicable) to the Commissioner, and
• the information provided to the agent for preparation of the tax return is true and correct.

The company must retain such a declaration or a copy of it for a period of five years.

For details about the personal information we collect from you, see Privacy notice – Franking account tax return.

Penalties for failing to lodge documents on time and general interest charge

The law imposes a penalty on a corporate tax entity that does not lodge this tax return by the due date. It also imposes a general interest charge on an entity that fails to pay FDT or OFT by the due date.

The Commissioner has the discretion to remit any penalty in whole or in part. If the entity considers the penalty should be remitted, a statement should be attached to this tax return explaining why remission should be granted.

The Commissioner also has the discretion to remit any general interest charge in whole or in part.

A request for the remission of the general interest charge should be made:

• in writing, and
• outlining fully the circumstances that led to the delay in payment.

Send the request by:

• fax to 1300 139 045
• mail to:
  
  Australian Taxation Office
  PO Box 327
  ALBURY  NSW  2640

Lodgment and payment requirements

When to lodge

Generally, the franking account tax return must be lodged, and the FDT liability and OFT liability must be paid, on the last day of the month following the end of the income year.

Late balancing corporate tax entities that elect to have their FDT liability determined on a 30 June basis must lodge a franking account tax return by 31 July each year. This date is also the date by which the FDT is payable. Note that there are different lodgment obligations in relation to OFT liabilities and disclosure obligations for these entities. For more information, see Late balancing corporate tax entities that elect to have their FDT liability determined on 30 June.

There are some different lodgment and payment rules that arise for certain refunds received within three months after:

• the end of the income year (or the period ending 30 June for certain late balancing corporate tax entities)
• a corporate tax entity ceases to be a franking entity.

For more information on these different lodgment and payment rules, see A refund of income tax affecting a FDT liability.

For subsidiary members of a consolidated group, where the head company has not notified us of the group’s formation, each group member may still be obliged to lodge a franking account tax return and pay any franking tax liability. This obligation exists until we receive notification of the group’s formation. If the subsidiary member believes it will not have an obligation to lodge a franking account tax return because it will be a member of a consolidated group for the full income year, it may request a deferral of time to lodge.

If the company does not subsequently form part of a consolidated group, the company will have to lodge a return and pay any franking tax amount owing. General interest charges may be applied back to the original due date.

If the company lodges a return and pays its franking tax liability on the due date, and, subsequently, the head company notifies us that the company was a subsidiary member for the full year, the subsidiary member will need to contact us to amend the return to zero and request a refund of any franking tax amount paid for this tax return.

Where to lodge

Post your franking account tax return with your payment to:

Australian Taxation Office
Locked Bag 1793
PENRITH  NSW  1793

How to pay

We offer you a range of convenient payment options, both in Australia and overseas.

Your payment needs to reach us on or before its due date. Check your financial institution’s processing deadlines to avoid making a late payment.

BPAY®

Make a payment directly from your Australian cheque or savings account to us using your financial institution’s phone or internet banking service.

Details you need:

• Biller code: 75556
• Reference: Your Payment Reference Number (PRN)

BPAY payments made out of hours, on a weekend or on a public holiday will not reach us until the next working day.

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Credit card

To pay online:

• Individuals can log in using your myGovExternal Link account linked to the ATO.
• Individuals and businesses can use the Government EasyPayExternal Link online service.

To pay by phone, call the Government EasyPay service on 1300 898 089.

You will need:

• your payment reference number
• a Visa, MasterCard or American Express card.

A card payment fee may apply to card transactions.

To get your payment reference number, you can go online:

• Individuals   
  • you need a myGov account linked to the ATOExternal Link.
   
• Businesses  
  • log in to the Business Portal
  • select ‘Payment options’ from the left menu.
   
• Registered agents  
  • log in to the Tax Agent PortalExternal Link or BAS Agent PortalExternal Link
  • select 'Payment options' from the left menu.
   

Alternatively, individuals and businesses can:

• ask your tax agent
• email payment@ato.gov.au
• phone 1800 815 886 between 8.00am and 6.00pm, Monday to Friday.

If you can't make a payment using BPAY® or credit card there is information on other payment options at How to pay.

More information

Go to ato.gov.au for general tax information and to download publications and rulings.

Publications

To get an ATO publication

If you are not a tax agent:

• go to ato.gov.au/publications
• phone 1300 720 092.

If you are a tax agent:

• go to taxagents.iorder.com.auExternal Link
• order by fax on 1300 361 462.

Phone

• Individuals 13 28 61
  For individual income tax and general personal tax enquiries
• Business 13 28 66
  For information about business income tax, fringe benefits tax (FBT), fuel tax credits (FTC), goods and services tax (GST), pay as you go (PAYG) and activity statements, including lodgment and payment, accounts and business registration (including Australian business number and tax file number), and dividend and royalty withholding tax
• Superannuation 13 10 20
• Tax agents 13 72 86
  For enquiries from registered tax agents

Other services

If you do not speak English well and need help from the ATO, phone the Translating and Interpreting Service (TIS National) on 13 14 50.

If you are deaf or have a hearing or speech impairment, you can phone us through the National Relay Service (NRS) on the numbers listed below, and ask for the ATO number you need:

• TTY users, phone 13 36 77. For ATO 1800 free call numbers, phone 1800 555 677.
• Speak and Listen (speech to speech relay) users, phone 1300 555 727. For ATO 1800 free call numbers, phone 1800 555 727.
• Internet relay users, connect to internet-relay.nrscall.gov.auExternal Link