A company gets the lower tax rate only if it is a base rate entity: aggregated turnover under the year's threshold, and no more than 80 per cent of assessable income being base rate entity passive income. Get that test wrong and the error carries straight into the rate used to frank a dividend. This tool runs the test, tracks the franking account, and checks the Division 203 benchmark rule.
A company's tax rate turns on whether it is a base rate entity: aggregated turnover under the year's threshold, and no more than 80 per cent of assessable income being base rate entity passive income. Get that test wrong and the error carries straight through to the rate used to frank a dividend.
This tool runs the base rate entity test, then tracks a franking account ledger, PAYG instalments, company tax paid, dividends paid and received, and refunds, and works out franking deficit tax and the 30 per cent offset reduction penalty where a deficit exceeds 10 per cent of annual credits. It also checks distributions in a franking period against the Division 203 benchmark rule, for over-franking tax and franking debit shortfalls.
It builds the statement fields a dividend distribution statement needs, too. That is a review helper for the statement, not a lodgement or a compliance certificate.
Nothing this engine produces is tax, legal or financial advice, an assessment or a determination. Outputs are review aids: confirm every rate, threshold and consequence against the current law and the entity's facts before acting, and leave lodgement decisions with a registered practitioner.
git clone https://github.com/ryanduguid/TheExchequerTally.git
cd TheExchequerTally && pip install .Two tests, both of which must hold for the income year: aggregated turnover below that year's threshold, and no more than 80 per cent of assessable income being base rate entity passive income.
Tax payable where a franking account ends the year in deficit. Where the deficit exceeds 10 per cent of the credits arising in the year, the offset for that franking deficit tax is reduced by 30 per cent.
Under Division 203 a company must frank all distributions in a franking period to the same extent. Departing from the benchmark franking percentage produces over-franking tax or a franking debit shortfall.