Australian requirement.

David Carlson carlson.dl at sbcglobal.net
Tue Apr 5 10:26:54 EDT 2011


On 4/4/2011 7:00 PM, Mal BUTLER wrote:
> I don't know whether anyone has suggested the following, & I realise
> Australia is a small market & thus may not have a very high priority.
>
> I don't know ehether any other country has the following system.
>
> In Australia, the financial system associated with Australian shares
> includes a "Franking Credit" item.
> Companies in Aus. pay company tax at about 30%.   As normal, they pay
> dividends.   These dividends are then seen as income for the Investor.
>
> To prevent the one dividend being taxed twice i.e. once as Company Tax
> & once as Income for the i\nvestor, the amount of Company Tax already
> paid is shown as a Franking Credit for the dividend amount, & becomes
> a credit for the Investor.
>
> At the moment, I don't thing that GnuCash makes allowance for thus.  
> I overcome it by creating a "Franking Credit" item & since the system
> is double entry I create a "Franking Credit Book Adjustment" which is
> hidden.
>
> For what it is worth .......
>
> Regards,
>
> Mal BUTLER
I am American and I do not know Australian law, but if I understand your
question; if a Franking Credit represents a tax that was pre-paid (from
your perspective), then would it make sense to make the Franking Credit
Book Adjustment a sub-account of Expenses:Tax?
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