Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-6 - THE IMPUTATION SYSTEM  

Division 200 - Guide to Part 3-6  

SECTION 200-35   Effect of receiving a franked distribution  

200-35(1)    
Under Division 207 , if an Australian member of a corporate tax entity receives a franked distribution, the member can usually offset, against the member ' s own income tax liability, income tax paid by the entity on the profits underlying the distribution.

200-35(2)    
The tax offset to which the member is entitled is equal to the franking credit on the distribution.

Note 1:

A member may be entitled to a refund under Division 67 if the sum of the tax offset and certain other tax offsets exceeds the amount of income tax that the member would have to pay if the member had not got those tax offsets.

Note 2:

If the member is not a resident, the tax effects of receiving a distribution will be dealt with under Division 11A of Part III of the Income Tax Assessment Act 1936 , and Subdivision 207-D of this Part.