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  • Rules and limits on claiming refunds

    If you haven't claimed your franking credits

    There are no time limits on claiming franking credits. Your organisation can claim a refund of franking credits for a particular financial year in later years. For example, you can still claim a refund of franking credits from the 2015 financial year in 2018. However, you must use the application form for the financial year that you are applying for.

    It is your responsibility to notify us of your eligibility to claim a refund.

    There are time limits for requesting an amendment to an assessment. We cannot amend an assessment if the time limit has passed.

    See also:

    Franking credit trading rules

    Your organisation’s entitlement to a franking credit refund may be affected by the holding period rule and related payments rule.

    These rules require taxpayers to meet certain criteria before they qualify for the benefits of franking. They ensure that only the true economic owners of the shares (or an interest in shares) have entitlement to the franking credits.

    One of the underlying principles of the imputation system is that the true economic owners of the shares should receive the benefits. They are exposed to both the risks of loss and opportunities for gain in respect of the shares.

    Franking credit trading schemes allowed those with no or only small exposure to the risks and opportunities of owning shares. Yet they then had access to the full value of franking credits. Such schemes could run over extended periods and typically involves a payment related to the dividend. This had the effect of passing its benefit in economic terms to a counter party.

    Holding period rule

    Your organisation must hold shares (or an interest in shares) at risk for at least 45 days (or 90 days for preference shares) during the primary qualification period to be eligible for a refund of franking credits. If your organisation is under no obligation to make a related payment, this rule only needs to be met once for each purchase of shares.

    The primary qualification period starts on the day after the day the organisation acquires the shares (or the interest). It ends on the 45th day (or 90th day for preference shares) after the day on which the shares (or the interest) go ex-dividend.

    Related payments rule

    This applies if your organisation has made, or is under an obligation to make, a related payment for a dividend. Your organisation must hold shares (or the interest) at risk for at least 45 days (or 90 days for preference shares) during the secondary qualification period to be eligible for franking credits. This rule must be met for all dividends and distributions where a related payment will be made.

    The secondary qualification period begins on the 45th day before, and ends on the 45th day after, the day the shares (or the interest) became ex-dividend (or 90 days before and after if the shares are preference shares).

    If you have shares in multiple companies and/or multiple franked distributions

    Your organisation is eligible for a refund of the franking credits on all the franked dividends that your organisation is paid, as well as all the franked distributions your organisation receives (for example, from trusts) in an income year.

    It doesn't matter how many franked dividends your organisation is paid (or how many franked distributions it is entitled to for the relevant income year). It is eligible for a refund on all attached franking credit entitlements for the relevant income year.

    Your organisation only needs to submit one request for a refund for all of the franked dividends paid and entitlements to franked distributions for the relevant income year.

      Last modified: 04 Jun 2019QC 16343