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  • What is a refund of franking credits?

    What are franking credits (formerly called imputation credits)?

    Attention

    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

    When you own shares or non-share equity interests in a company, or invest in a managed fund you may get dividend distributions.

    Dividends paid to shareholders by Australian companies and some New Zealand companies are taxed under a system known as imputation. The tax paid by the company is allocated (or imputed) to shareholders by way of franking credits attached to the dividends they receive.

    When are franking credits refunded to me?

    If the franking credits you receive exceed the tax you have to pay you can claim this difference back as a tax refund. This is what is known as a refund of excess franking credits.

    You may be entitled to a refund of the full amount of franking credits received, even if you don't normally lodge a tax return.

    The 2004 application for refund of franking credits for individuals is available for download.

    What's changed for 2004?

    You may be entitled to claim Australian franking credits on dividends paid by some New Zealand companies this year. For more information see the questions and answers section. Legislation has been introduced into Parliament that may affect the amount of your claim. At the time of printing this was not yet law. For further information, please phone the Tax Office on 13 28 61.

    Last modified: 10 Jan 2005QC 27524