Franked dividends in Australia


R

Ray

I am a disgruntled Quicken user and got Money (ver 12)
with a new computer. After using it for a short while I
have found a shortfall that for a user like me is enough
to make me stick with Quicken.

In Australia we have 2 different types of
dividend. "Franked" for which the company has already
paid company tax so we get a tax credit (or "imputation
credit" as it is called) for that amount. The other type
is "unfranked" for which the company has paid no company
tax. I cannot see how I can control Money sufficiently to
distinguish between these 2 different types using the
investing actions in Money. Any ideas would be
appreciated.

I realise this is the UK site but this is where Help
sends me and I cannot find anything useful on the Aussie
MS site.
 
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G

Glyn Simpson, MVP

I would suggest you use two transactions. A dividend transaction from the
investment into the investment account and a balancing transaction to deal
with the tax credit. When there is no tax credit, then miss out the latter
 
C

CWatters

Ray said:
I am a disgruntled Quicken user and got Money (ver 12)
with a new computer. After using it for a short while I
have found a shortfall that for a user like me is enough
to make me stick with Quicken.

In Australia we have 2 different types of
dividend. "Franked" for which the company has already
paid company tax so we get a tax credit (or "imputation
credit" as it is called) for that amount. The other type
is "unfranked" for which the company has paid no company
tax. I cannot see how I can control Money sufficiently to
distinguish between these 2 different types using the
investing actions in Money. Any ideas would be
appreciated.
I suspect the best way might be to enter a seperate transaction for the tax
credit. eg..

For franked dividends enter:
One transaction for the dividend _inc_ tax (eg as if it was unfranked)
One transaction for the tax credit (eg as if you had made a payment out to
the tax authorities).

You will then need to play around with the reports to get one that lists all
the tax credits (assuming you need to submit these to the tax authorities to
reduce your liability).

If you are a serious investor there are other "problems" with Money to watch
out for. ex the treatment of accrued interest on fixed interest bonds.

Colin
 
R

Ray

Thanks for the suggestions. Building on them I've decided
that the thing to do is to enter a dividend as Other
Income then use an appropriate category (div franked, div
unfranked, or franking credits). I should have thought of
this without your help. Thanks again for your help.
 
C

Cal Learner

Thanks for the suggestions. Building on them I've decided
that the thing to do is to enter a dividend as Other
Income then use an appropriate category (div franked, div
unfranked, or franking credits). I should have thought of
this without your help. Thanks again for your help.
I used to do a similar thing in another way. I created an account
called, in my case, "tax withheld". I would enter a second dividend
transaction for the stock and specified the destination account as
"tax withheld". Each year I would make a compensating entry to zero
the value of the account.

But your way may appeal to you. My way tended to credit the
particular stock as having contributed the money.

I since stopped doing this because it was more trouble to me than it
was worth.
 
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R

Ray

Our tax returns require us to keep separate records of
the 3 categories (franked, unfranked divs and franking
credits - you add them all up to get your dividend income
then claim a tax credit for the credits). I will get the
income applied to an individual stock because I am using
the "other income" in the investment activity field.
After reading your post I tested it and it does work.

Thanks
 
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