Re: Australian Dividend Franking

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Posted by Don Atkinson on April 15, 2006 at 06:52:27:

In Reply to: Re: Australian Dividend Franking posted by Mark on April 13, 2006 at 10:51:06:

Mark,

I would also greatly appreciate some support for Australian dividend franking.

I'm primarily interested in seeing the real performance of the share and so it is not critical for me to see the franking credit as a deposit to a cash account.

The benefit of the credit does depend on your marginal tax rate, which,in my case, is a tax rate of 0% as I run a Super Fund in Pension mode. Accordingly the fund will eventually (after the end of the current tax year) receive from the Tax Department the full 30% tax that has already been paid by the company.

A Super Fund in accumulation mode (not paying a pension) may be paying tax at 15% so would get 15% (30%-15%) back, whilst an individual may be on a top rate of tax (say 49%) and therefore be required to pay an additional 19% in tax.

In the vast majority of cases the marginal Tax Rate will be known for the full year so a possible solution may be for the user to be able to pre-set the marginal tax rate for the year, then only enter the franked and non-franked components and have FM calculate the amount refunded or taxed and use the result as part of the performance calculation.

I appreciate this presents a problem for FM as it is a variation to your policy of basing calculations on pre-tax figutes, and I also hasten to add that I am not an accountant!

Nevertheless support for this Australian "oddity" would be much appreciated and further enhance your already excellent program.

Regards,

Don

Replies:

• Re: Australian Dividend Franking Mark 11:08:45 04/15/06 (2)
  • Re: Australian Dividend Franking Gary Wilson 01:52:43 05/10/06 (1)
    • Re: Australian Dividend Franking Mark 10:12:35 05/10/06 (0)