Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-6 - THE IMPUTATION SYSTEM  

Division 200 - Guide to Part 3-6  

SECTION 200-25   A corporate tax entity must not give its members credit for more tax than the entity has paid  

200-25(1)    

A corporate tax entity must not frank a distribution from profits with a franking credit that exceeds the maximum amount of income tax that could have been paid, at the entity ' s corporate tax rate for imputation purposes for the income year in which the distribution is made, on the profits distributed.

200-25(2)    
If a distribution is franked in excess of this limit, the entity will be taken to have franked the distribution with the maximum franking credit for the distribution.