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The Forum > Article Comments > Fully franked must be frank and fair > Comments

Fully franked must be frank and fair : Comments

By Everald Compton, published 27/2/2019

It is beyond dispute that Bill Shorten is correct when he states that a cash refund of franking credits on investments should be claimed only by a taxpayer.

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It's obviously NOT beyond dispute; it's being hotly disputed.
Posted by ttbn, Wednesday, 27 February 2019 9:08:18 AM
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Pity I saved and invested wisely in my younger, working, day.
Should have just pissed it all against a wall and then reaped the taxpayer provided benefits as many do.
Posted by ateday, Wednesday, 27 February 2019 9:47:02 AM
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I have no problem with folk saving for retirement and earning money from dividends. But can't go with fully franked unless those folk pay our tax here.

Given how much of this is diverted to foreign entities simply seeking to avoid any of our legitimate tax!

My solution is to simply raise the tax threshold and apply it to all incomes earned here! That would let the long suffering taxpayer off the hook and keep more of our income onshore!

Grand fathering negative gearing, should likewise, be only available to Australian nationals.

One needs to take on board the very reason for the collapse of the Celti tiger! And avoid following their moribund example!

Least we emulate their miserable economic misfortune!

Finally, let me conclude by saying, the age of enitlement is over! HELLO WORLD! Hehe, snigger snigger!

Pass the havanas and yes I'll have conyac. move you dumb sh!t, I'm a VIP!
Alan B.
Posted by Alan B., Wednesday, 27 February 2019 10:58:31 AM
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The problem with the entire franking debate is that the rebate only applies to your marginal rate of tax. Given that if you earn $37000 your marginal rate is 32.5% and your franking rebate is $0. Which means that before retirement, the only recipients are just making ends meet.

The exception of course are retirees whose saved super does not count as income, which is why this is principally a tax on retirees.
Posted by Shadow Minister, Wednesday, 27 February 2019 1:47:41 PM
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So I had a sole proprietary company and thought I will use its profit to save for old age. Instead of pocketing the profit immediately and paying the marginal tax, I decided to live frugally and take just what I need each year, pay the company tax (then 36%) on the remainder, keep the 64% of the profits in term deposits, then when I retire, slowly withdraw the rest as franked dividends and get my 36% back, tax free.

Well the first blow was when company tax was reduced to 34%, then 30%, so I immediately lost 6% of my savings.

Then keeping the company-structure was no longer viable for unrelated reasons, so I had to take the money out much earlier than I needed it, put it instead in this new creature called "superannuation", which I understood little of, and lose much of it to the 2008 GFC.

Otherwise, had my original plan been still intact, then come Shorten I would lose 36% of my savings in one stroke.

In conclusion, I learnt my lesson the hard way: never leave your money with companies or their shares, but keep it close and personal! If all low-income pensioners hid my advice then none would now be taxed on their savings.

And if you still want to have shares, then insist that the companies of your shares distribute their profits to you in the same financial year as they receive them, unfranked!
Posted by Yuyutsu, Thursday, 7 March 2019 12:39:41 AM
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