Re: Australian Franking Credits

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In Reply to: Re: Australian Franking Credits posted by Mark on November 03, 2000 at 07:32:42:

: : Mark,

: : You have developed an excellent program. One of the best and easiest to use that I've seen.

: : Have you ever considered adding the functionality to handle tax credits on distributions (in Oz we call these Franking Credits or Imputed Tax Credits) resulting from the tax paid already by the company issuing the distribution? Are you aware of our local situation regards distributions and the need to track (for income tax purposes) any franking credits which come with distribution? Entering the distribution with tax credits included (effectively giving a pre-tax return) does not work if the distribution is reinvested as the price of the reinvested shares or units will not be right as the number is based on the franked (after tax paid) amount.

: : I have not found a way to track these within the program other than noting the amount of the Franking Credit in the Memo field. If an additional field could be added "tax credit", then you would be able to report these, and also the have the option of doing the yield calculations and investment returns either with or without the inclusion of the tax credits.

: : Now, I would have to separately record all the dividends and franking credits (say in a spreadsheet) for tax reporting. Seems a shame not to be able to use FM to record all the details of the distribution.

: : I know your local situation is different to ours, but have asked this as it seems there are more and more people from around the world looking to use your program. Hoping for your support to include this.

: : Thanks again for a great program.

: : Regards,
: : Brian.

: Hi Brian,
: Thanks for the feedback. I have heard of the Franking Credit before, but
: probably need to learn more. One solution that has been used for this before
: is to use the "Other" distribution category to record your tax portion
: of the distribution, and the regular "dividend" category to record the
: franked amount of the distribution. This requires two entries, the total
: of the two being equal to the total amount of the distribution.
: Fund Manager reports all performance figures as pre-tax. It does not
: attempt to comprehend the effects of taxes on performance. It does of
: course report capital gains, but all the yield and %gain type numbers are
: pre-tax numbers. To calculate the effects of taxes on your yields would
: vary widely from person to person, and country to country.

: Thanks,
: Mark
: --
: Mark Beiley
:
: Fund Manager for Windows 3.1x/95/98/NT
:
:

Thanks for that advice Mark. I am now recording dividends as you suggest. Yes - it requires 2 entries per franked dividend but serves my purpose when it comes to tax reporting.

Thanks,
Brian.

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