Calculation statement labels C, T2, D and T3

C – Non-refundable non-carry forward tax offsets

Write at label C the total of actual rebates and tax offsets available (in dollars and cents) and not the amounts giving rise to those tax offsets.

The rebates and tax offsets shown at label C are not refundable, nor are they carried forward. They are only offset against gross tax. Gross tax can't be less than zero. If these tax offsets are greater than the gross tax, the excess tax offsets can't be used and are lost.

Don't show at label C any FDT offset; write this amount at label F Franking deficit tax offset.

Keep a record of the following:

• Each type of tax offset – the amount claimed for each type.
• Franking tax offsets
  • the distribution statement, which contains the
    • name of the payer
    • date the dividend was received or credited
    • franked amount of the dividend
    • unfranked amount of the dividend
    • franking credit allocated to the dividend
    • amount of franking credit tax offsets allowable for each franked dividend received
    • franking percentage of the dividend.
  • records to substantiate
    • deductions relating to dividends
    • the type of distribution – for example, foreign source dividend, bonus shares, phasing-out dividend, liquidator’s distribution
    • the dates on which shares, for which dividends were received and tax offsets claimed, were acquired and disposed of.
• Short-term life insurance policies, including
  • a copy of the policy
  • the amount of the bonus included in assessable income under section 26AH of the ITAA 1936.

T2 – Subtotal 1

Write at label T2 the amount of tax payable after label C has been offset against label B Gross tax.

Label T2 can't be less than zero.

Work out the amount at label T2 as follows:

• If the amount at label C is less than the amount at label B
  • subtract label C from label B
  • write the result at label T2.
• If the amount at label C is more than or equal to the amount at label B
  • write zero (0) at labels T2, T3, T4 and T5
  • the amount at labels D and F may be carried forward to a later income year (subject to the tax offset carry forward rules in Division 65 of the ITAA 1997)
  • copy the total amount at labels E to I.

D – Non-refundable carry forward tax offsets

Write at label D the total of actual tax offsets available (in dollars and cents) and not the amounts giving rise to those tax offsets.

The tax offsets shown at label D are not refundable. They are only offset against gross tax, if there is any gross tax to be paid after label C has been applied to gross tax. Gross tax can't be less than zero.

Any excess offsets can be carried forward to a later income year (subject to the tax offset carry forward rules in Division 65 of the ITAA 1997).

Before you can apply a tax offset carried forward from a prior year to reduce the amount of income tax that you will pay, you must apply it to reduce certain amounts of net exempt income. Net exempt income is reduced by $1 for each 25 cents of the tax offset if the company is a base rate entity for the year, otherwise $1 for each 30 cents of the tax offset.

T3 – Subtotal 2

Write at label T3 the amount of tax payable after label D has been offset against label T2.

Label T3 can't be less than zero.

Work out the amount at label T3 as follows.

• If the amount at label D is less than the amount at label T2
  • subtract label D from label T2
  • write the result at label T3.
• If the amount at label D is more than or equal to the amount at label T2
  • write zero at labels T3, T4 and T5
  • the difference between labels T2 and D (subtract label T2 from label D) may be carried forward to a later income year (subject to the tax offset carry forward rules in Division 65 of the ITAA 1997)
  • the amount at label F may be carried forward to a later income year
  • copy the total amount at labels E to I.

Continue to: Calculation statement labels E, T4 and F

Return to: Instructions to complete the Company tax return 2024