ATO Sends Out Franking Credits Application Credits for NFPs
6 July 2009 at 4:08 pm
The Australian Tax Office has mailed out the 2008-09 refund of franking credits application package to Not for Profit organisations that received a refund of franking credits in the prior year.
The purpose of the mailout was to provide these organisations with the necessary information and forms to claim a refund of franking credits from dividends received in the 2008-09 income year.
The mailout included:
• a fact sheet that helps organisations work out if they are eligible to claim a refund for the 2008-09 year (NAT 6716)
• an application form for the income year 1 July 2008 to 30 June 2009 (NAT 4131), and
• instructions on how to complete the form (NAT 6715).
This publication can be downloaded at Refund of franking credits – 1 July 2008 to 30 June 2009 – Endorsed income tax exempt entities and deductible gift recipients (NAT 6716, PDF, 84KB).
Franking credits attached to franked dividends received by the following organisations may be refundable, provided the eligibility criteria are met:
• entities that are endorsed as exempt from income tax
• deductible gift recipients
• developing-country relief funds, and
• exempt institutions that are eligible for a refund under a Commonwealth law other than the income tax law.
Franking credits arise for shareholders when certain resident Australian companies pay income tax on their taxable income and distribute their after-tax profits by way of franked dividends. These franked dividends have franking credits attached. Franked dividends are received either directly as a shareholder or indirectly as a beneficiary of a trust.
Organisations that receive a dividend from a New Zealand company with Australian franking credits attached to it, will be able to obtain a refund of those credits if they would have been able to, had the dividend been paid by an Australian company.
The fact sheet, instructions and a sample copy of the application form are available on the ATO website.