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- 19 March 2019
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That seems like good information. How about New Zealand, our closest neighbour, where I understand there is still franking credit but I don't think there is cash refunds ? Please advise.
How Dividend Imputation Is Applied Around the World
Taxpayers in countries wherein dividend imputation is offered will typically claim the appropriate credit when filing their taxes.
Dividend imputation has had a mixed history among different nations, as the circumstances of each country’s tax system prompt varying applications. Nine countries that once offered such an arrangement have either changed or ended the practice. These countries include the following:
- United Kingdom
- Ireland
- Germany
- Singapore
- Italy
- Finland
- France
- Norway
- Malaysia
The United Kingdom and Ireland, for example, previously offered partial imputation with tax credits that were, effectively, portions 12 cents to 25 cents on each dollar. The partial imputation in the United Kingdom provided a 20 percent refund against a 33 percent corporate tax rate. Starting in 1997, however, the government moved away from this, first by eliminating the refund to tax-exempt shareholders that includes pension funds. Then, in 1999, the refund rate was cut to 10 percent.
Germany, Finland, Norway, and France all previously offered full dividend imputation. France offered tax credits equal to 50 percent of the face value of the dividend. After the repeal, these countries taxed dividends at a rate of 50 percent or greater. Germany did away with its dividend imputation program with the intent of reducing the nation’s tax rate. Finland, likewise, lowered its corporate tax rate after dividend imputation as repealed. Norway, on the other hand, did not lower its corporate tax rate when dividend imputation ended.
Time will tell how it all plays out and my thought is it's a gamble.But as you pointed out I have posted an lot on the subject, so I had better let it go, everything has been said that could be said. IMO
May I ask , what's the point in owning shares if Shorten wants 75% of your profit in your tax return?
I find that really interesting, a 12% increase in a tax, isn't the end of civilization as we know it.I'm just going to expand on this point, 75% of your profit in your tax return. 75% of your gain is assessable income. So if you take a retiree for example, who sells a property to help fund their retirement, and makes a profit of $300,000 on the sale. 75% of $300,000 will be assessed: $225,000
Tax on 225,000 = 78,847 (assuming no other assessable income for the year)
So Shorten has taken 26% of your profit in this example.
Let's look at the same case, for a high income earner who also makes a profit of $300,000. If he was on the top MTR he would pay tax on this gain of $110,250. This is the 'worst case scenario', i.e. the most tax you could possibly pay on a capital gain.
In this example, Shorten has taken 37% of the gain. (compared to 25% under the current CGT rules)
It's a big tax hike and I absolutely do not agree with the changes, but let's put it in perspective, but it's not the end of civilisation as we know it. You would still have capital gains taxed at only 15% through super and 0% in a pension.
Simply applying the GST as it was originally intended, that is to everything with no exceptions, would have plenty of people up in arms due to loss of their tax exemption the existence of which directly cuts funding for schools and the like given that GST revenue goes to the states.So if we increased GST by 12% it really isn't a problem?
I will look it up when I get back on Monday, away on the Indian for the weekend.How long has Combet been in that position?
I will look it up when I get back on Monday, away on the Indian for the weekend.
I'm just going to expand on this point, 75% of your profit in your tax return. 75% of your gain is assessable income. So if you take a retiree for example, who sells a property to help fund their retirement, and makes a profit of $300,000 on the sale. 75% of $300,000 will be assessed: $225,000
Tax on 225,000 = 78,847 (assuming no other assessable income for the year)
So Shorten has taken 26% of your profit in this example.
Let's look at the same case, for a high income earner who also makes a profit of $300,000. If he was on the top MTR he would pay tax on this gain of $110,250. This is the 'worst case scenario', i.e. the most tax you could possibly pay on a capital gain.
In this example, Shorten has taken 37% of the gain. (compared to 25% under the current CGT rules)
It's a big tax hike and I absolutely do not agree with the changes, but let's put it in perspective, but it's not the end of civilisation as we know it. You would still have capital gains taxed at only 15% through super and 0% in a pension.
If I had a million dollars in or out of super I can assure you the last thing I'll be worrying about is refunding franking credits. But I suspect my situation will be quite different.
I find that really interesting, a 12% increase in a tax, isn't the end of civilization as we know it.
Just shows how affluent we are.
So if we increased GST by 12% it really isn't a problem?
Or are we saying who gives a $hit, as long as the increase only affects a few, as long as it isn't me.lol
$70,000 in bank interest from a million dollars ? LOLYeah probably have not run the numbers, you will be stuck paying 30% tax while your peers in other asset classes and jobs will only pay 20% tax, doesn’t seem fair.
But if you got a refund, your total tax would drop back to the 20% that every one else is paying that earns the same as you.
If you had $1 Million in shares, you would be getting around $50,000 in dividends, and would be stuck paying paying 30% tax on the grossed up amount of $70,000 that hits your tax return.
All the while some one else earning $70,000 in bank interest or rental property, or share trading will only be paying 20% tax.
Yeppers. Colorbond fencing and pavers make decent outdoor showers for camping...
All the house does, is keep the weather off you and your toys. LolYeppers. Colorbond fencing and pavers make decent outdoor showers for camping...
Nice bike BTW
$70,000 in bank interest from a million dollars ? LOL
Put it this way VC - if you stopped the taxpayer funded gravy train that hands out money frivolously then chances are I wouldn't be slugged with that 30% tax in the first place.
And neither would all those employers hence better profits and dividends yeah?
For the record - I get far better returns from trading than from dividends.
50/50 ratio in the portfolio
For the record - I get far better returns from trading than from dividends.
Have you done the numbers on the tax revenue that would raise ?Just make a flat 30% tax on every dollar for every one then.
why pick out shareholders to be the only ones with a minimum of 30% tax
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