Tagging additional values on transactions

[Martijn van Oosterhout]

On Sat, Aug 10, 2002 at 10:55:24AM -0400, Derek Atkins wrote:
> What is this "Franking Credit" and how does it relate to the rest of
> the dividend transaction?  Keep in mind that a Transaction is a
> zero-balance object, so this "Franking Credit" has to balance
> something, I'm just not sure what it is balancing.  Could you
> give a concrete example?

As I mentioned in my other email, it's not a real credit as such, but a
figure to fill in your tax return to indicate the tax the company has
already paid on it. You're right, I hadn't thought of the balencing issues.

Say you have shares in company X. They give you $100 in dividend. Normally
that would be counted as $100 income and you would pay income tax on that.
However, if the dividend is calculated after the company has paid tax on
their profits, you shouldn't be taxed on the full amount.

So, on your statement you get a "Franking Credit" which represents what the
company has paid. On the above amount it might be around $40. So after you
have worked out your income tax (including the $100) you get to take $40 off
that.

How do other countries deal with this? I've never though about it.

Anyway, I've figured I can also make up a currency called Franking Credits
"FCR" and set the exchange rate to zero. Then I can add it to all the
places I need to and make reports based on it.

This is actually better than adding extra fields to splits. Much neater.

Thanks,

> Martijn van Oosterhout <kleptog@svana.org> writes:
> 
> > [Please CC any replies, thanks]
> > 
> > As is the case probably in other countries, but when you get dividends on
> > shares here there is another figure called a Franking Credit. It's not money
> > in any sense but you put it on your tax return so you pay less tax. Since
> > GnuCash is a financial program it would be nice if it could keep track of
> > these figures also instead of me digging them up.
> > 
> > I guess it's related to storing tax amounts for businesses.
> > 
> > Anyway, since each split is stored as a list of values, how hard would it be
> > to add a new value and have it displayed in the output screen and be allowed
> > to edit it and such?
> > 
> > Thanks
> > -- 
> > Martijn van Oosterhout   <kleptog@svana.org>   http://svana.org/kleptog/
> > > There are 10 kinds of people in the world, those that can do binary
> > > arithmetic and those that can't.
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> 
> -- 
>        Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
>        Member, MIT Student Information Processing Board  (SIPB)
>        URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
>        warlord@MIT.EDU                        PGP key available

-- 
Martijn van Oosterhout   <kleptog@svana.org>   http://svana.org/kleptog/
> There are 10 kinds of people in the world, those that can do binary
> arithmetic and those that can't.