5th Dec 2018
How Labor’s franking tax credits plan would affect you
Author: YourLifeChoices
How dividend plan could affect you

Tony Kaye
Until a few months ago, the tax on dividends, which creates franking or imputation credits, was not on some investors’ radars. It possibly still isn’t.

But those relying on franking credits to supplement their income in retirement were definitely jolted into paying attention after the Labor Party announced it planned to overhaul current tax breaks.

The ALP’s plan to abolish cash refunds on excess imputation credits, announced in March, has created great consternation among many older Australians.

Dividend imputation was introduced some 30 years ago, to avoid the double taxation of company income. Because most Australian companies are taxed at 30 per cent, when a fully franked dividend is paid it comes with a tax credit attached for the 30 per cent of tax already paid by the company.

Some companies pay a partly franked dividend, in which case the credit is for less than the full tax liability.

Currently, if you are in Age Pension mode who owns shares, and are not paying on your income, franking credits are returned to you as a cash rebate. The ALP had planned to abolish them for good, but has now stated it would create a Pensioner Guarantee if elected to exempt people fully or partly on the Age Pension from its proposal..

This will do little if anything for close to one million Australians who are members of self-managed superannuation funds (SMSF) and other self-funded retirees who fall outside the Age Pension safety net.

That means many people who had created a retirement strategy around stocks paying out fully franked dividends, whose share prices had effectively been inflated as a result of investor demand for their tax credits, could be looking further afield if the ALP is elected.

A new research report by Macquarie Wealth Management points to a likely major shift in Australian equity asset allocations by retirees and others should the ALP’s contentious policy be passed in the future.

Despite the ALP’s recent backflip on who its franking credits crackdown would apply to, Macquarie notes that those in the firing line, including retired SMSF trustees receiving dividend tax credits, will likely shift capital into higher-yielding stocks paying unfranked dividends.

A Treasury review of the proposal earlier this year, found that the expected $10.7 billion in additional tax revenue the ALP had calculated it would receive from the policy over the forward estimates would not eventuate because many retirees will likely move into other assets paying better returns, including foreign stocks.

Investors who buy those retirees’ stocks will be able to use the associated franking credits to reduce their own tax liability, thus Treasury would still be forgoing tax revenue.

In an update based on franking credits data to the end of December last year, Macquarie says that another outcome of the ALP’s plan could be an acceleration of capital management initiatives by companies with large franking account balances, including special dividend pay-outs.

But the investment bank has added that given the relatively small proportion of investors overall who would be impacted, it was unlikely companies would be incentivised to alter their dividend policies.

Australia’s second-largest company, BHP, holds more than $14 billion in franking credits, followed by Rio Tinto ($4.7 billion), Woodside ($2.6 billion), Woolworths ($2.6 billion), and Commonwealth Bank ($1.1 billion). Westpac also holds around $1.1 billion in franking credits, followed by Caltex with $868 million.

The response, therefore, is more likely to be on the investor side, potentially with a rotation out of stocks paying 100 per cent franked dividends (where there would no longer be cash refunds available) into high-quality companies paying attractive yields.

Macquarie’s research suggests there could be a rotation into companies currently paying unfranked yields of between four per cent and seven per cent, from those currently paying higher grossed-up fully franked dividends.

On an unfranked basis, the yields from these companies are compatible with those of companies paying unfranked returns.

For older Australians, it’s a case of staying tuned for now rather than taking any direct action one way or another.

Tony Kaye is the editor of Eureka Report, which is owned by financial services group InvestSMART.

Are you eligible for an Age Pension? Do you know your rights? The RetirePlanner™ tool has all the information you need.

RELATED ARTICLES


    Financial disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.





    COMMENTS

    To make a comment, please register or login
    TREBOR
    5th Dec 2018
    10:34am
    "those relying on franking credits to supplement their income"

    That's the clincher - franking credits are not and should not be a supplement or free handout to increase income from dividends, which is precisely why I have advocated that imputation be abolished and companies pay their taxes and their dividends, and individuals pay their own taxes.

    There is no way an individual or entity should be receiving a full dividend payment plus a bonus, and far simpler to simply have each pay their own.

    What that should mean in practice is that the final payment should remain the same - if it does not, then that is the proof in the eating needed to say this is a rort.

    For those who are slow here, Loathie - DI is supposed to be included as part of gross income - so why bother with it in the first place if it is not a rort?
    OnlyGenuineRainey
    5th Dec 2018
    10:48am
    Firstly, Trebor, many retirees have no option to rely on franking credits to supplement income. With cruel asset tests and poor investment returns generally, what is the alternative? Shares return around 4% on average without franking credits. Property is returning poorly at present. Bank and term deposit interest is a dead loss. Vast numbers of retirees have never had any opportunity to become investment experts, and we all know the risks of relying on paid advisers.

    Secondly, the franking credit refunds are NOT a supplement or bonus. They are a valid and genuine return of tax taken from income that, in the hands of the dividend recipient, should not be taxed. The government gains huge benefit from the ATO holding that cash between collection and repayment, but it's in no way a 'bonus' or 'supplement'.

    To say that franking credits should not be relied on as income is to say that an employee should not rely on the net income he SHOULD receive given his marginal tax rate and applicable deductions and rebates, but should count any tax refund as a 'bonus' or 'supplementary income', no matter how excessive the tax deducted from his wage at source.

    This whole argument has been so dishonestly distorted by the greedy, the envious, and lying Labor politicians. It's really very simple. The dividend PLUS any franking credit is the income the shareholder is entitled to receive. If they are not legally liable to pay tax, they should receive the franking credit as a cash refund, because it's OVERPAID TAX and it DOES NOT BELONG TO ANYONE BUT THE SHAREHOLDER (morally and ethically, regardless of what disgraceful and deceptive lawmakers might try to claim).
    Jim
    5th Dec 2018
    11:15am
    Sorry TREBOR you are mostly correct in many of your comments and quite often quite humorous, but in this instance I believe you and many others are way off the mark, I still can’t understand why many people are so against anyone who has paid tax on their investment and claim a rebate when it works out that your income falls below the tax free threshold, that’s all that a fully franked dividend is, the amount of tax you have paid generally 30% which is far higher than many low income earners pay in tax, what people on this site are advocating is blatant discrimination against pensioners and other low income earners that may have a few shares, and I still question the legality of what they are trying to do, I know that Shorten has done a back flip on attacking many of the people that would have been affected, have you never heard of a politician changing their mind again once in the Lodge, the fact that Shorten ever thought this was a good idea is concerning. The article presenter has already raised doubts that this idea is unlikely to gain the 10 billion dollars that Shorten thought it would, in fact its quite likely that it will raise no or very little tax, I think we can assume that Shorten has already spent this money on some of his crazy ideas, so where do you think the money’s coming from to pay for things like up to 60% supplement to women’s superannuation?
    Paddington
    5th Dec 2018
    11:34am
    Jim, it will not affect pensioners. That has been stated repeatedly.
    As far as others who need it apart from the big companies, maybe put your case including your earnings and show that you fall below the income of a pensioner. If you are reduced to a low income that does not even equate to the pension you may have a case if you have relied on this to fund your basic lifestyle.
    Rubbishing Labor in view of what the present government has done is not helpful. If you support the LNP who certainly will never stand up for low income earners it is confusing your argument.
    If I were in the position that some are describing I would see an adviser and look at spending down or rearranging my finances to a point where I was eligible for a pension even if it is a mere dollar a week.
    Shifting your capital is another option as described above. Some may find that more honourable.
    TREBOR
    5th Dec 2018
    11:42am
    Correct, Rainey - that's why there should be zero difference in the eventual income derived... if you pay your own tax on total income instead of some withheld for you, the result should be the same....
    TREBOR
    5th Dec 2018
    11:48am
    The problem, Jim - is the ability of business types to simply write down their income to next to zero and thus receive a massive windfall from DI... it does not affect the smaller DI earner who does not have that ability (in general)...

    I've said countless times before that what needs to be closely looked at is how people in 'business' can enjoy the facilities up to billions, yet have no income..... and principally that is because the rules for 'business' were established in the eighteenth century when only the top minority had a vote and could influence rules etc, an also had the capital to engage in 'business ventures'.

    Billy Baker the pasty guy could set up a shop, and take his chances on the market totally - Lord Flauntalot could buy into a business venture to make steel, but demand guarantee that his input would not lead to loss for him or his family.... and thus tax concessions were born for business that Billy did not receive....
    Old Geezer
    5th Dec 2018
    11:58am
    Trebor your comments tell me you have absolutely no idea how franking credits work.
    Jim
    5th Dec 2018
    12:02pm
    Paddington perhaps I didn’t make it very clear, but if you look through my response again I think you will find that I have said exactly that, and it was also explained by the presenter, that Shorten did a back flip on the franking credits where it affected pensioners and other low income earners, but I will repeat again, have you never heard of a politician changing their minds after an election, or are you suggesting that it is only the LNP that change their tune, especially when a fully funded idea is put as part of their election promise until they find out that the money they were going to raise doesn’t actually exist. I have only been voting for about 50 years and I have seen it happen on numerous occasions, and committed by both major parties. I have no problem with the Labor party, but I do have a problem with Bill Shorten, the man is a grub of the highest order, he was a traitor to the union, that is not hearsay, I was a member and had a few dealings with Shorten on which to base my opinion of this grub, I have mostly voted Labor over the last 50 years, but I will be making an exception this time, I know it will only be my personal protest that will not make any difference, but it might make me feel better.
    Jim
    5th Dec 2018
    12:20pm
    TREBOR I don’t disagree with your anology, except to say that there are far more people that are rorting the system than people realise, it’s not just the top end of town, eg how many tradies do you see driving around in $50-$60 thousand utes, who do you think is paying for them, the tax payer is, and also paying for the maintenance on not just their vehicle but also on their families vehicles, I am not having a go at tradies, but again how many people on this site can honestly say they have never had a job done cash in hand, these practises are ripping tax payers off to the tune of hundreds of millions a year, go to any major town on a weekend you will find markets on, they are not all selling second hand stuff, many import cheap products from overseas, do you think these people pay tax on their profits, I doubt very much that any of them pay tax, we accept these tax avoiders for obvious reasons, we get a cheap deal, we often throw stones at business tax avoiders who actually employ other people that pay tax, but we think it’s ok for joe the local sparkie to rip the tax payer off.
    Paddington
    5th Dec 2018
    12:41pm
    Jim, only the first sentence was aimed at you personally. Don’t vote for a leader vote for policies. Whose policies do you prefer at the moment?
    I believe the top priority for everyone should be the environment. Attenborough made it clear it is urgent. Who is the most likely to have policies that will help? The answer is probably the Greens but can they get into power and do anything about it?
    Some very good independents are in parliament now like Kerryn Phelps but can she help by herself?
    My feelings are it is Labor with the help of the Greens and the likes of Kerryn Phelps.
    A vote is a precious thing which at this point in time I would not waste on the LNP who are unable to even govern themselves and would not prioritise the issue of global warming
    Adrianus
    5th Dec 2018
    1:02pm
    People do vote for a PM and the parties are now realising this. The standing of the leader tells a lot about the rest of the rabble.
    Paddington
    5th Dec 2018
    1:23pm
    Adrianus, people rebelled against the last PM being turfed because he was a moderate. The far right of the LNP is having too much influence and they are making the LNP look bad. Abbott and Co. may not be finished yet.
    People are not trusting them to be fair or decent exemplified by the Sexual Discrimination Act that merely requires that the part that allows children to be targeted in schools be erased. People get very upset when children are harmed.
    TREBOR
    5th Dec 2018
    2:03pm
    I wouldn't say 'aimed at Jim' - I respect Jim for his fairness and knowledge and intellect.... those attributes may be shared to some degree by others here (who I will not mention except to say O and L), but the sensibility portion of their 'sense and sensibility' precept is deliberately skewed to a certain way of life not shared by the majority.

    (deep, huh?)...

    Ah, yes - tradies and shop owners with Maseratis (don't laugh - the son of a Marrickville fruiterer in the 1970's ran around in a Maserati.. you don't get that kind of cash from selling fruit and veg - heroin/dop maybe.. not fruit and veg)...

    Going back to the analogy - Billy Baker wasn't considered a 'business' back then for taxation and concessions - just a local worker... 'business' was 'big business' in which the rich dabbled. Now, of course, Jack the plumber and Phil the excavator have all kinds of concessions not held by Joe and Jo Reliable as they work in the slum jobs.... I've had business and worked for wages - business was far more lucrative .....

    That's why I know the rules need to be changed and brought into line with the 21st Century and its realities.
    TREBOR
    5th Dec 2018
    2:07pm
    I think Mick had the only viable answer - and let us never forget that the Costello change gave that windfall to the fat with no questions asked - and put a dollar cap on DI, so that the small earners with no rorts can be excluded from taxation.

    That figure is up for negotiation and with the proviso that it must be indexed annually.

    I still retain the view that the 'top end' need a thorough cleaning out on tax hiding... 'legal' or not..... we've seen the value of 'within the rules' when applied to politician's perks - why should they cut out their chances of continuing those once they leave politics (with no future and in need of dramatic pension etc) and go into 'business' - if they ever left it?

    They are all... LNP/Labor/Greens etc.. LIFTERS, aren't they - and thus entitled to the fattest of the land....
    TREBOR
    5th Dec 2018
    2:19pm
    I have every idea, OG - of how it is being wrongly applied at the moment.... the reading says one thing,the practice says another.

    Look below - Loathie says his franked credits are all taken up in resolving his tax bill... say again? Your franked credits are supposed to be part of your gross and calculated in your final bill - not used directly as an offset.

    It appears the ATO is not doing its job correctly - perhaps on orders......... that must change.
    Old Geezer
    5th Dec 2018
    2:25pm
    Trebor Bullshit.
    Lothario
    5th Dec 2018
    2:35pm
    Trebor simply has NFI
    OnlyGenuineRainey
    5th Dec 2018
    3:38pm
    Paddington, why should anyone have to evidence they have an income less than the pension in order to qualify for FAIR taxation? The wealthy can still claim their franking credits under Shorten's unfair policy. High income earners can still benefit with a big tax reduction. Pensioners who own multi-million dollar homes can still benefit. Why should a self-funded retiree have to evidence anything to recover tax taken from his/her income that wasn't payable in a fair world? Like Shorten, you are being unfairly discriminatory against self-funded retirees and low income earners who invest in shares to try to improve their lifestyle or build a future. Pensioners get massive handouts from the taxpayer purse, yet you suggest that those who save the taxpayer $1 million or more by self-funding their retirement should pay tax at 30% on income that others earn tax free. That's a disgusting position to take - unfair in the extreme, immoral, dishonest, and economically harmful as it will push more and more to dispose of assets and go on the pension or invest overseas or in property.
    OnlyGenuineRainey
    5th Dec 2018
    3:41pm
    BTW Paddington, while I think the Greens are a disgrace and a mob of idiots, I would have agreed that Labor was the better choice until Shorten and Bowen started telling massive lies to sell a disgustingly unfair and economically harmful policy. Their dishonesty is unforgivable and makes them unfit to govern.
    Lothario
    5th Dec 2018
    3:41pm
    OGR - when will you realise that people like Paddington and Trebor are small minded fools who dont understand taxation or simply only care about how much they get and anyone not on welfare can get stuffed
    TREBOR
    5th Dec 2018
    7:10pm
    Well. Lowthario (LMAO) my small-minded fool - the ATO clearly says that tax imputed for dividends (@ 30%) is to be included in gross income - ergo, dopey - it is to be added to your dividend payments which are then added to your gross income - and then your tax liability is calculated.

    According to your own admissions here - you earn considerably more than that- so it is impossible for your 30% DI to offset your tax burden in any way - unless you are one of the cheats the ATO is currently hunting down like dogs....

    From your own mouth, you are receiving more than the 30% point for income, and thus should be paying more for your dividends...

    You are a thief, sir... and a small-minded one at that.

    You and those like you are the reasons the rules are changing..... get used to it before they eat you alive.
    TREBOR
    5th Dec 2018
    7:12pm
    I'll say it again for those who can't follow simple rules:- Dividend imputation is tax withheld and is included in gross income of the recipient..... and tax liability is then calculated on gross income, same as any PAYE worker.

    Dividend imputation is NOT a free gift, and nor should it be... and from your confessions here, Lowthario, you and others are cheating on your taxes.
    Old Geezer
    5th Dec 2018
    7:22pm
    I agree with fair taxes but this non return of dividends is no where near a fair tax.
    TREBOR
    5th Dec 2018
    8:09pm
    Then why don't you take your dividends whole and without DI? Solves the whole problem of return or no return.....
    OnlyGenuineRainey
    6th Dec 2018
    8:27am
    And how does one do that when the company in which one invested determines to pay the tax and issue a franking credit, Trebor. You are living in la la land. We are not at liberty to make our own rules. Politicians have seen to it that far more powerful people are in control, so that they may manipulate and contrive to rob those they choose to abuse and benefit their mates.
    Old Geezer
    6th Dec 2018
    9:53am
    How do you do that Trebor when the ATO has your dividend and franking credit already prefilled in your tax return. If you change it you will be fined for doing so.
    floss
    5th Dec 2018
    11:33am
    OGR what a great well thought out comment and very correct.What will happen to Retirees that had their pension concession card reinstated by Turnbull Nov 2017 after the Hockey disaster.If you make any change to super you must grandfather it as it will cause all sorts of problems to pensioners.
    Grateful
    5th Dec 2018
    11:43am
    Best advice "For older Australians, it’s a case of staying tuned for now rather than taking any direct action one way or another."

    This issue is far from concluded.
    Old Geezer
    5th Dec 2018
    11:55am
    I agree there is every chance this policy will be shafted completely or watered down considerably. One suggestion has been to tax the franking credits so that only 95% of them are refunded or offset giving the same result but much fairer to all.
    Adrianus
    5th Dec 2018
    12:20pm
    Are you saying we should wait to see if we are stupid enough to elect Labor?
    Old Geezer
    5th Dec 2018
    12:25pm
    Exactly it will show we have too many stupid people with welfare mentalities in Australia and no wonder we are going down hill fast.
    Paddington
    5th Dec 2018
    12:45pm
    Adrianus/OG, there are plenty of us who will vote labor as shown in the recent Victorian election. They include people who understand the importance of addressing global warming. Read my comment above!
    Old Geezer
    5th Dec 2018
    12:55pm
    So you have been conned by the rich as they will be the ones that become even richer with an emissions trading system to fix so called global warming. One problem the planet is actually cooling not warming but people have taken the rich man bait hook line and sinker.
    Adrianus
    5th Dec 2018
    1:10pm
    Paddington, Global Warming was a tag used to scare us when we had a heat wave. It was changed for a brief moment in time when we realised the planet was cooling rather than warming, until the name changed to Climate Change to save confusion.
    School Teachers obviously think its a big deal this election.
    When is Labor going to come up with sensible policies which benefit all Australians?
    Old Geezer
    5th Dec 2018
    2:09pm
    Climate change is even more confusing as climate change has been happening since the universe was formed. No climate change no humans.
    TREBOR
    5th Dec 2018
    2:09pm
    With all due respect - I think a vote for Labor these days is a protest vote against the LNP... and is not the best long term answer... there will be a protest vote against Labor's excesses in future, which leaves us where?

    Right where we started from, but a little bit worse off all round in terms of personal security, retirement, rights and fair dealings over our own finances.
    Misty
    5th Dec 2018
    2:48pm
    Liberals lost a safe seat they have held for 70 years today in Victoria and that Liberal MP said almost everyone he door knocked said their main concern was Climate Change, even the Liberal voters and his own 17 year old daughter, who does not align with the Greens and Labor, marched with the school students last Friday in protest against the Government's Climate Change Policy.
    Paddington
    5th Dec 2018
    3:22pm
    OG and anyone who cannot comprehend the magnitude of the threat of global warming:
    Just do it for your kids and grandkids and their grandkids because you cannot take the risk that you are right and it is a fallacy because the opposite is unthinkable.
    Old Geezer
    5th Dec 2018
    3:49pm
    Paddington so you too have been conned by the rich on climate change who want to use it to get richer at the expense of everyone else.
    OnlyGenuineRainey
    5th Dec 2018
    3:50pm
    Anyone who thinks a vote will stop global warming is a complete IDIOT. Sorry, but it's true. The eruption of one volcano spewed more harmful gasses into the air than the whole of Australia generates in over a decade. We can't stop climate change! In terms of emissions, Australia contributes as much as a tiny pimple on the back of a king-sized bull.

    As for the silly little darling school kids who went on strike over it, and their foolish teacher-advisers - Goodness! They must have air conditioned homes and classrooms, be driven to school in cars, live in flash big houses built with all kinds of materials the manufacture of which causes pollution, use computerised devices all day every day, have the latest and greatest appliances in their homes - replaced often, have swimming pools in their backyard... On and on it goes. When the little darlings walk or ride bikes to school, put their computerised devices and mobile phones aside, and lobby for fans instead of air con, they just MIGHT have some credibility. In the meantime, the dunces shouting about climate change just look like gullible fools - most likely supporting goals that have nothing whatever to do with climate and everything to do with enriching politicians and lobbyist for reducing emissions.

    I do my bit for the environment as far as I'm able - composting waste, recycling where practical, avoiding air conditioning in my home, planting trees, etc. But anyone with a brain knows it's a lost cause.
    Old Geezer
    5th Dec 2018
    4:01pm
    Agree we can't stop the climate from changing and why would we want to anyway?

    The wealthy want an emissions trading system so they can buy up the credit cheaply and then charge what they like for those who must then have them. That's is what this climate change is really all about.
    Misty
    5th Dec 2018
    4:16pm
    OG everything is not about money but you and others commenting here seem to be obsessed with it, getting back to climate Change you can't tell me that billions of people living on this planet, factories pumping out poisen into the atmosphere, cars, aircraft, ships etc all adding to the damage being done has not changed the climate. Even if the scientists cannot agree isn't it better to take out insurance just in case the ones saying Climate Change is real are proved correct?.
    Old Geezer
    5th Dec 2018
    4:51pm
    Misty climate change is all about money to make the rich richer.

    If you think Labor supports climate change think again. If they were fair dinkum about it then why are they supporting Adani and allowing coal exports to continue? Those coal exports do tons more so called damage that we do ourselves. Until coal exports are stopped I don't believe either party supports so called climate change.

    If you wish to be continued to be conned then so be it.
    floss
    5th Dec 2018
    12:01pm
    Correct Grateful this one has a long way to go, the main thing is not to panic.It has to be fine tuned as it may hurt their own supporter base as is.
    clarkey
    5th Dec 2018
    12:10pm
    As I have read on FB posts. If you are receiving $25k in imputation credits you would have to have approximately $1.5 million in share holdings. Not a bad way to live out the rest of your life "comfortably". GREED IS GOOD! Stop bitching you wealthy retirees, Labor has said they won't touch you!
    Old Geezer
    5th Dec 2018
    12:29pm
    Rubbish. You can have $25,000 in franking credits on very little invested.
    OnlyGenuineRainey
    5th Dec 2018
    3:57pm
    Clarkey, you really are a selfish bigoted fool! Those with $25K in imputation credits ARE likely to keep them. It's those SFRs on very low incomes with maybe $8 - $10K in franking credits (or less) who NEED their franking credits and will be deprived under Shorten's wrongful policy.

    Labor isn't attacking the wealthy. It's attacking battlers who are saving the taxpayer $40K+ a year by self-funding their retirement, and it's making them worse off than if they hadn't saved at all but just put their hands out for pensions.

    Greed is good - but it's people like YOU who are greedy, wanting to STEAL the EARNED income of workers and savers by taking 30% tax on income that should be tax free, and grind them into hardship, while rich pensioners party with TRIPLE HANDOUTS (pension plus franking credit refunds plus concessions).
    Old Geezer
    5th Dec 2018
    4:03pm
    OGR I am very concerned what is really behind this policy. Are they just buttering us up for something far worse?
    TREBOR
    5th Dec 2018
    7:20pm
    No, Rainey - those on low incomes from DI will have it evaluated in regard to their overall tax burden and where a refund is applicable will receive it.

    Those who receive a lot more but manage to squirrel it away and say they get none will be the ones caught and rightly so, hence Mick's idea of a limit after which you are seriously reviewed for DI and have to justify any refund from it.

    Lowthario claims to lead the high life, buy a Merc etc, and still use DI to offset his other tax burdens - that means he is cheating... and those are the people who are targeted by this.

    The ATO appears, from what these fools here say, to be NOT handling DI correctly as part of income..... so your lower income DI will be safe IF the ATO does its job properly.
    Old Geezer
    5th Dec 2018
    7:25pm
    Trebor the truth be known without the refund of franking credits many people would not disclose all of their income because there is no reason without the return of franking credits for them to do so. Labor misses out on even more income.
    OnlyGenuineRainey
    5th Dec 2018
    7:42pm
    WRONG, TREBOR. Shorten has been absolutely emphatic that SFRs will NOT be spared. Only pensioners are the ''new elite''. Not only will NO SFRs be allowed to claim their refund, no matter how low their income, but even when they drain their savings and are plunged into asset hardship and qualify for a pension, they will NEVER get franking credit refunds - EVER. They are to punished for ever having worked and saved to avoid imposing on the taxpayer, and the penalty is harsh. Shorten has been very clear he will NEVER reconsider his policy.
    TREBOR
    5th Dec 2018
    8:11pm
    I'll be asking Shortenski for a clarification of that, Rainey.... just give me a day to run the ex to doctors and such.. I'm tired already...
    fred
    6th Dec 2018
    11:18am
    clarkey and Trebor, like most left socialists are hell bent on stripping the private savings and tax free incomes from all self funded Australians . Why are you not satisfied with receiving your tax free Government pensions and concessions on car registrations , energy , travel etc etc . Just because we saved more and went without they want us to lose our same tax free tax status .
    It is typical envy from all bludgers and you will never be satisfied but just winge
    Old Geezer
    6th Dec 2018
    12:07pm
    Fred its just the mentality of those on welfare including OAPs. They think because they are alive the world owes them a living.
    Misty
    6th Dec 2018
    3:38pm
    What a terrible comment to make OG, just when I thought you had hit bottom with your remarks you come up with this insulting demeaning comment.
    Misty
    6th Dec 2018
    3:40pm
    You lot commenting on here and calling the OAP names greedy etc well it seems to me that you are the jealous ones, get a bit of humanity into your lives for a change.
    OnlyGenuineRainey
    6th Dec 2018
    6:14pm
    Those pensioners who support the ALP's wrongful policy ARE GREEDY, Misty. They are taking TRIPLE HANDOUTS - well in excess of $1 million over the course of their retirement - and denying others a miserable few thousand a year in refunds of OVERPAID TAX. That's extreme greed. YOU NEED TO GET SOME HUMANITY INTO YOUR LIFE FOR A CHANGE.
    Adrianus
    5th Dec 2018
    12:15pm
    "But the investment bank has added that given the relatively small proportion of investors overall who would be impacted, it was unlikely companies would be incentivised to alter their dividend policies."

    I disagree, there definitely will be for many, particularly related shareholders of unlisted companies, an acceleration of capital management initiatives, if it comes down to a case of use it or lose it! What is the other choice?
    Lets remember, companies would not be in this situation had we not had an anti business, incompetent government. Even in opposition they reach out to wreck the economy.
    Paddington
    5th Dec 2018
    12:48pm
    Adrianus, and LNP have done so well lol!
    OnlyGenuineRainey
    5th Dec 2018
    3:59pm
    LNP have done appallingly, Paddington, so let's elect a mob who will do far worse and who can't even tell the truth, let alone show respect for the rules of fairness.
    Old Geezer
    5th Dec 2018
    7:26pm
    I don't normally bother voting as to me it's all a farce but I will be this time around as I want the satisfaction of voting Labor last.
    Misty
    6th Dec 2018
    11:55am
    Your vote won't make any difference OG if the past election results are anything to go by.
    OnlyGenuineRainey
    6th Dec 2018
    1:29pm
    That's right, Misty. The votes of LYING CHEATING THIEVING GREEDY SCUM will determine the outcome - the SCUM who have decided that SFRs should be robbed so pensioners can gloat about their superior wealth and claim superior status.
    Old Geezer
    6th Dec 2018
    1:55pm
    Misty maybe I should vote 20 times then just to make a bigger difference. Vote early and often I think they say.
    Misty
    6th Dec 2018
    3:35pm
    You won't get away with that this time OG, especially if the Coalition bring in the law they want passed, identification at the voting venue.
    Old Geezer
    6th Dec 2018
    3:47pm
    Nothing stopping me using that same identification at 20 booths.
    Misty
    6th Dec 2018
    4:09pm
    Get with the technology OG , once identified at a polling booth do you think they won't have it in their computer records?, they won't let you vote again that day.
    Old Man
    5th Dec 2018
    12:17pm
    I'd like to see what Labor's policy actually is on franking credits. We are told that pensioners will be exempt but SMSF users have still not been told if and how they will be affected. The assets and income test can be a double edged sword, a person can miss out on a pension or part pension because of either income or assets but what if a person has shares returning an income that is fully franked and the DI is withdrawn. Their income is down to the extent that they may be eligible for a pension or part pension but the value of the shares precludes them from a pension or part pension.

    I note that politicians are prepared to grandfather negative gearing and maybe the way to go with DI is to grandfather it along the same lines. My cynicism suggests that politicians have investment properties and very few shares and are therefore not too bothered with grandfathering the proposed DI.
    Old Geezer
    5th Dec 2018
    12:27pm
    Pollies earn enough to keep their franking credits.
    Adrianus
    5th Dec 2018
    12:28pm
    The battle ground is superannuation. A disadvantage to SMSFs is an advantage to union funds. The Union Funds have been scrambling for infrastructure and wouldn't mind a drop in the share market. This massaging of the Imputation System has been cleverly thought out.
    Old Geezer
    5th Dec 2018
    12:31pm
    There is only one reason why Labor wants to get rid of SMSFs. It wants to nationalise super so that when you die the government gets what's left of your super and not your beneficiaries. SMSFs make it difficult to nationalise super.
    Adrianus
    5th Dec 2018
    1:14pm
    Getting rid of SMSFs and retail Funds, leaves oh, only Union Funds? The ones in control are the ones controlling OPM.
    TREBOR
    5th Dec 2018
    2:12pm
    Yes - I note Big Bill hasn't clarified that yet.... I have raised the issue with him...

    Adrianus - I'm a strong Union man, but I also advocate removal of super funds from all hands including Unions and into one basket (case) where they can all be handled fairly and equitably.... a genuine national superannuation future fund....

    (I said FUTURE fund, Igor - not FURORE fund! You can get furore anywhere, especially here!)...
    see all.Maryakate
    5th Dec 2018
    1:31pm
    People do seem to be greedy these days instead of looking out for their neighbours they are too busy trying to get the last cent out of the Government of the day. How many get a rebate on their power? Thirty years ago these same self funded retirees would have been in the workforce and buying shares as another income stream. Then when worked ended they still wanted to live the same lifestyle, and gradually ate into their retirement money, now when they hear that their double dipping could end, they cry foul. Then they come the old chestnut, 'I paid tax all my life' but still used the schools hospitals, medicare, university,roads, public transport and the many things our taxes cover. Yes it is nice to get a refund or an acknowledgement but it is only a that ad not a right. So look on your loss of double dipping as a way of helping those not as fortunate as yourself
    Old Geezer
    5th Dec 2018
    1:45pm
    Refund of franking credits is the refund of tax you have paid on your dividends so is not double dipping at all. If it is not refunded it is double taxation. Franking means tax paid just like you pay tax as you go as a worker. If a worker didn't get a refund of the tax they have overpaid you wold be hearing people screaming all the way to the moon and back. This is the same thing but with a different name nothing more.

    Your comments tell me you have no idea how franked dividends work or are taxed. Stop listening to Labor's propaganda and find out how they really work instead.
    OnlyGenuineRainey
    5th Dec 2018
    4:07pm
    seeall. Maryakate - you are seeing NOTHING but a lot of Labor lies and greedy, selfish pensioner BS. Who are you to claim retirees bought shares while in the workforce? Many didn't buy any at all until after low interest rates FORCED then to take their money out of banks. And they are NOT double-dipping. They are asking for FAIR TAXATION - the same FAIR taxation that applies to others. But you greedy selfish pensioners want TRIPLE HANDOUTS while others get NOTHING. Having never bothered to save, you now want $1 million bucks to fund your retirement, plus concessions AND you think you have an exclusive right to franking credit refunds as well. Bugger off greedy! SFRs are complaining because their frugal lifestyle SAVES the government $40K+++ per annum, and you bastards want them screwed, paying 30% tax on income that should be tax free and having less left to live on than pensioners. Meanwhile the wealthy, high income earners, and rich pensioners with multi-million dollar houses keep their benefit.

    I am ENTITLED to my franking credits, because my income dividend income was taxed at source and I am not liable to pay tax on my miserable $30K a year income (for a couple). You bloody pensioners take nearly $40K a year when concessions are counted yet want the credits as well, and you think it's fair to rip them off me. Your greed is disgusting.
    Old Geezer
    5th Dec 2018
    4:38pm
    seeall. Maryakate

    I'd like to ask you a question,

    Is it fair that if I earn enough so that my $5000 is refunded against my tax paid so I can then use it to go on a holiday but the person earning $20,000 including $5000 in franking credits has their income reduced to $15,000 which means they have $100 a week less to spend on groceries?
    TREBOR
    5th Dec 2018
    7:24pm
    Easy then Maryakate - just pay everyone the same and there is no argument.. (Jesus....)

    You are again spouting the LNP line, OG - those on small incomes will have their tax liability assessed as normal.... If Rainey's total income does not incur tax, she gets all
    DI back since it is tax withheld on her behalf.

    OG and Lowthario are trying to muddy the waters and shoot the messengers of truth, and are fear mongering without reason.

    Easy solution - as many times - abolish dividend imputation entirely and let the shareholders take the chance that the company won't fold and then pay them nothing... with DI (tax withheld on behalf) they are guaranteed 30% of dividend payment even if the company goes bally-up (and the bosses chortle off into the distance with millions)...
    Old Geezer
    5th Dec 2018
    7:29pm
    Trebor if a compony goes belly up then shareholder get nothing but lose everything.
    OnlyGenuineRainey
    5th Dec 2018
    7:47pm
    Trebor, why do you persist in LYING to muddy the waters. There is NO PROPOSAL to do as you claim. The ALP has been VERY CLEAR and emphatic that they will NOT reconsider. SFRS, no matter how poor, will lose their franking credit income - FOR LIFE. END OF STORY. Pensioners, no matter how rich, will keep theirs - along with their pension and concessions, making TRIPLE HANDOUTS from the taxpayer purse. They are the new elite. Stop pretending it's something it isn't. Yes, there are probably ways to improve the fairness of the current system. But the ALP IS NOT INTERESTED in fairness, equity, or even being truthful.
    TREBOR
    5th Dec 2018
    8:14pm
    That's what I just said - OG - the 30% tax is withheld dividend payment on your behalf, and if the company has paid that, at least you get that 30%.

    Note that phrase.. withheld dividend payment.. same as PAYE tax .. it does not mean it is tax free.... it is to be included as part of your gross income.....

    That seems to be the problem.... the way it is being handled by accountants (see Lowthario the Entitled) and then the ATO.. apparently the ATO is not doing its job and allowing too many to get away with too much.

    I note the ATO has had staff numbers reduced and is flooded with affirmative action types.. Jesus God.....
    OnlyGenuineRainey
    6th Dec 2018
    8:34am
    Trebor, where do you get the idea that the dividend is NOT included in gross income? Of course it is. And when gross income falls below the tax threshold, the tax that was deducted should be refunded - just like any other tax that is deducted from income but not actually due and payable. PAYE taxes are refunded if taken in excess. Bank interest withholding tax is refunded if taken in excess. There IS NO DIFFERENCE- -except lying ALP mongrels seek to steal from one sector of the community by falsely claiming it's different.
    1984
    5th Dec 2018
    1:42pm
    Maybe it's time for the government to take over all the super funds and bring it under their control so no more top end of town excessively greedy little piggy snouts in the trough. Make transparency a priority, employ professionals that will have to adhere to strict guidelines for the benefit of the people. That way no multimillion $ salaries or ridiculously obscene bonuses.
    Do away with all SMSF. They can cash in all there wealth & put into the government controlled national super fund. If SMSF retirees want to keep control over their investment, fine but they will be treated by the ATO as having an income like any working Australian & pay the same appropriate tax irrespective of age.
    & introduce a universal pension with no deemed or asset testing. This can be paid for by the savings on simplifying the OAP.
    The current system is RS & gets worse every budget as the greedy LNP & ALP gouge more money from retirees.
    Money can also be generated by the government to pay for a universal pension by taxing the interest earned on ones super irrespective of age. no tax concessions because you're 60 or over. If you earn you pay tax.
    Old Geezer
    5th Dec 2018
    1:53pm
    Nothing wrong with SMSFs at all. I would not have super if I couldn't have an SMSF. I would gladly pay any extra tax if it was in my own name as it would be a lot less than fees in the sort of super you want. The cheapest industry fund I could get to managed my super recently was $20,000 and that is over 10 times what I pay to have a SMSF and more than the tax I wold pay if it was all in my own name.

    I agree we should not have no tax on super after 60 as that only benefits the wealthy with high super income. Many people would be better off with their super taxed and the 15% rebate that is the system for under 60.
    TREBOR
    5th Dec 2018
    2:16pm
    Not the government, 1984 - The Trebor Scheme, fully independent and the government may apply for funding and receive fair handling on merit of projects.... along with others ....

    SMFs may continue, but not as super funds... as investment portfolios and such, while they can still top up their TTS super fund to a specified limit... all incomes above are subject to taxation.

    TTS effectively does not alter the current situation for the many, but only secures super funding against predatory retailers, government, and... others (unions etc) who may exploit it..... and also brings under control the excessive ability of some few to garner a heap out of a false paradigm of super... including politicians who will be equally subject to TTS.
    Lothario
    5th Dec 2018
    1:51pm
    Well done labor
    Another beautiful policy designed to increase the gap between the well off and the not so well off
    It’s actually designed to increase their voter base in the long run by adding millions more on welfare
    Old Geezer
    5th Dec 2018
    1:55pm
    I agree many more people will be on welfare under a Labor government with such stupid policies. I'm thinking of buying a $10 million house myself.
    Lothario
    5th Dec 2018
    1:57pm
    Fortunately for me , all my franking credits are used up to offset my annual tax bill
    Old Geezer
    5th Dec 2018
    2:08pm
    Only ones I lose are in my SMSF but it wont be worth having under Labor so I'll just cash it in. Otherwise I have enough income to use the rest.
    Old Geezer
    5th Dec 2018
    2:07pm
    This submission to the Standing Committee on Economics clearly states who is effected by the removed of cash refunds of franking credits.

    https://d3n8a8pro7vhmx.cloudfront.net/advanceaustraliaorgau/pages/114/attachments/original/1543922117/AA_Submission.pdf?1543922117
    OnlyGenuineRainey
    5th Dec 2018
    4:16pm
    Excellent submission, though it sadly didn't mention the gross unfairness of allowing high income earners a tax credit but denying the same tax treatment to low income earners.

    It's a pity the bigoted selfish Labor supporters who blindly endorse this policy don't bother to educate themselves on the FACTS, but just echo Labor's disgraceful lies.
    see all.Maryakate
    5th Dec 2018
    4:20pm
    I couldn't let your comment pass without adding my own. Yes, some company's pay tax on the dividend you receive that's how they run their business, then they hold on to it for some time before they pay it out, to you.When you do your tax you add that dividend into your tax assessment as interest earned. A bit like bank interest. So do you make a profit or a loss? Have you paid tax on your income? Are you entitled to a tax refund? Or do you pay tax to the ATO ?
    As for your Submission to Government for a fair go for all Australians, I fail to see what you are trying to say. No tax for those over 60, or a fair go for all Australians, especially those unfortunate in their younger days, to buy shares, and still get a Government handout (pension).
    Although I have not read what the Labor Party Policy will be, but I can't see that most Aged Pensioners will suffer because of the changes. It seems they want to make the system better for the main.
    Lothario
    5th Dec 2018
    4:24pm
    the IQ of some posters on here must be lower than that of a slug
    OnlyGenuineRainey
    5th Dec 2018
    4:34pm
    seeall.Maryakate, clearly you have no idea what you are on about. Good that you admitted you hadn't read the Labor Party policy. If you did, you MIGHT see how idiotic your comment is. To put it simply, dear - yes, tax is deducted from your dividend income before you receive it. Labor says if you are wealthy or earn a high income, have over $1.6 million in superannuation assets - you can KEEP your tax credit for that deducted tax. If you are a pensioner, no matter how rich - with maybe a multi-million dollar home or hidden assets - you can keep your tax credit for that deducted tax. If you are a low income earner or self-funded retiree with very modest assets, and therefore a modest or low income (perhaps even LESS than the pension) SCREW YOU. We'll keep that overpaid tax and deprive you both of fair income and enough to live on. Not only that, but when you drain your savings compensating for the ripoff, you can go on the pension, but you will NEVER get franking credit refunds ever again, no matter how poor you may become.

    That's the policy, seeall.Maryakate. Nothing to do with making the system better for the majority. And no, Aged pensioners won't suffer. They will enjoy GROSSLY UNFAIR FAVOURITISM, no matter that they may well be far, far richer than their deprived SFR counterparts who get NOTHING from the taxpayer purse.
    TREBOR
    5th Dec 2018
    7:28pm
    Of that Lothario - there is no doubt - especially in your case... you are stuck in the groove of the current rorts and can't even see reality coming at you like a runaway express steam roller....

    Now do try to stick to not insulting others here - or the boys at YLC might chew on you a little... I've wanr5ed you countless times - offer facts and figures to refute - not insults, you dope.

    Slow learner....
    TREBOR
    5th Dec 2018
    7:30pm
    Rainey - I can see from what you said, that I need to get into Bro Shorten about that silly idea.... that cannot be for real.

    Think I'll front him Friday.... after I've had a break from a few things going on.

    If that's his policy he needs reaming out with a very large round file to remove the detritus inside....
    OnlyGenuineRainey
    5th Dec 2018
    7:58pm
    Good grief, Trebor. Has it taken this long to get it? That IS the policy. It's been spelled out very clearly. It's been challenged again and again, and clarified in the same terms. Shorten has faced countless arguments from every quarter and his response is ''You can talk to me up hill and down dale and I will NEVER change my mind on this." Please do front him, but don't expect him to listen.
    Lothario
    5th Dec 2018
    8:03pm
    OGR - when Trebor says he gets it , he means his own warped interpretation.
    The guy can't even understand a simple concept like Dividend Imputation fgs.

    After all this time, you still havent learnt that there are a few on here that simply are incapable of understanding anything more than perhaps Grade 2 arithmetic
    TREBOR
    5th Dec 2018
    8:42pm
    That's you in a nutshell, Loathie - you can only add rort + rort = rort.....

    You will be under scrutiny .....

    Supercilious prat..... don't listen to him Rainey - he's a schill without a cent in his pocket...
    TREBOR
    5th Dec 2018
    8:44pm
    .. and I've said all along that DI is part of income and must be treated as such - and if you have a REAL income - not a Lothario income - below tax limits, you should get all orpart of it back.

    I know all about dividend imputation, Loathie - you know all about the cash manipulation that the government in waiting is stalking..... my kid's mother had a fabo accountant... he was eventually caught out and suspended...... lots of weeding to be done it seems....
    Misty
    6th Dec 2018
    11:58am
    Disgusting comment Lothario, says a lot about the sort of person you are.
    OnlyGenuineRainey
    6th Dec 2018
    1:23pm
    "DI is part of income and must be treated as such - and if you have a REAL income - not a Lothario income - below tax limits, you should get all or part of it back."

    Precisely what happens now, Trebor. But Shorten seeks to change it so that if you have Lothario income, you still get it back, but if you have REAL income before the tax limits, you are robbed.

    Misty, your support for Labor's wrongful policy speaks volumes about the person you are. I don't like Lothario or his comments, but he's not supporting THEFT from honest Australians for no better reason than that they didn't cheat the system to get pensions they don't need.
    Lothario
    6th Dec 2018
    3:36pm
    Which of my comments was disgusting Misty ?
    Misty
    6th Dec 2018
    4:13pm
    Saying some people commenting here are lower then slugs for 1.
    Misty
    6th Dec 2018
    4:15pm
    Only Genuine Rainey I sincerely hope you are not implying that I am a cheat.
    Lothario
    6th Dec 2018
    4:16pm
    Its a fair comment

    Do you read some of the idiotic comments. These people don't understand the imputation system, yet dare to post absolute nonsense

    Sadly they think they're right. Must be sad to have a brain like that

    These very people call those who use the imputation system correctly, thieves and cheats . Now you tell me who is disgusting !!!
    OnlyGenuineRainey
    6th Dec 2018
    6:11pm
    I never suggested you were a cheat, Misty. I said you are supporting theft. By supporting the Labor Party, you are endorsing theft, unfairness, cruelty, lies, gross hypocrisy, elder abuse, and the taking of income from hard working battlers to give it to the rich. Proud of yourself?

    And BTW. I hate the LNP have NEVER supported them. I would have voted Labor if the ALP hadn't shown its hand and revealed just how disgusting and harmful their policies are.
    Old Geezer
    5th Dec 2018
    2:52pm
    Labor's Franking Policy is Elder Abuse on an industrial scale.
    Rae
    6th Dec 2018
    9:51am
    No because those on aged pensions will still get it. It's an attack on SMSF pure and simple.

    There are plenty of ways to change investment and go for yield as the article said. Franking Credit Refunds is simply a lazy way of making income but you have to wait for it. If you go for capital growth and sell at sensible times it allows a bit more flexibility anyway.

    As you say. Know the rules and as they change then change with them.

    This policy shows how discrimination is not important to Labor. It singles out just one group to punish just as Hockey's budgets did.

    That was the real danger of Hockey's budgets. Not the outcome but the fact the No Disadvantage Rule was breached and just about everyone missed it.
    OnlyGenuineRainey
    6th Dec 2018
    1:28pm
    Rae, just because someone saved well for retirement doesn't make them an investment expert and they shouldn't have to be. It takes time, skill, and risk tolerance to go for capital growth and sell at sensible times. It's NOT something the majority can do - and they shouldn't have to in order to BENEFIT taxpayers by not taking $40K a year +++ in handouts. Retirees have a right to the retirement they earned, and to peace and security in their old age.

    OG is right. It is elder abuse - but only against a sector of retirees, which makes it also highly discriminatory, unfair, and cruel to battlers. And Labor purports to be all about fairness, stopping discrimination, and supporting battlers. Boggles the mind that anyone could be blind enough to vote for such a mob of lying hypocrites. But I guess some folk would happily rob their grandmother too. In fact, they do.
    floss
    5th Dec 2018
    3:48pm
    And the Fib of the day goes to O.G.
    Old Geezer
    5th Dec 2018
    3:54pm
    Which Fib number is that?
    OnlyGenuineRainey
    5th Dec 2018
    4:17pm
    He's NOT fibbing on this issue, Floss. He's absolutely correct.
    TREBOR
    5th Dec 2018
    7:31pm
    More than Tony Abbott, OG...... just give us a list and we'll vote on your fibs...
    Old Geezer
    5th Dec 2018
    7:35pm
    Here is a blank piece of paper Trebor.
    DaveL
    5th Dec 2018
    3:54pm
    To elimate the discrimination to young and old, do away with the “Seniors Tax Offset”. Genuine pensioners will pay no tax if this is done.
    Old Geezer
    5th Dec 2018
    3:57pm
    Seniors Tax Offset is there so pensioners don't pay tax on their old age pension.

    The problem is the no tax on super after 60 policy which means the wealthy pay no tax on their super.
    DaveL
    5th Dec 2018
    4:10pm
    OG, genuine Pensioners will pay no tax. A pensioner couple receive around $18,000 each a year, and the Low Income Offset of $1000 will cover single pensioners. Pay tax on what you receive.
    Old Geezer
    5th Dec 2018
    4:53pm
    So it's OK for people to earn $120,000 with only the low income tax offset and pay no tax then?

    This will still happen under Labor.
    TREBOR
    5th Dec 2018
    7:37pm
    Seniors Tax Offset is to compensate partially for the simple reality that the current wages and super value is higher in dollar terms than the past due to inflation..... and thus the ability to salt away cash is proportionately diminished...... and any super will not have the same money value in even two years as it does now.

    That is clearly why the current assets test and super handling need a thorough cleaning up, and a different view taken of retirement funding.

    A guaranteed income in retirement is a must.... from what Rainey says, as a SMFR, she is getting less than pension, which is a disgrace...

    On the other hand I know a couple who have a waterfront home, three investment properties and a host of super and other stuff, who are still complaining about losing $12000 pension money in the overhaul. **shakes head in disbelief**

    Many factors need looking at.... and inevitably will be soon.
    TREBOR
    5th Dec 2018
    8:48pm
    No, OG - re-read your own statement - 'low income tax offset' - how is $120k 'low income'?

    The teaching is hard work.. some are so slow.... and some so hidebound in their current misconceptions that it will be a chock to them when reality catches up.

    Lots of work ahead to clean up the 'simplified' tax system that Howard gave us..... **shakes head in disbelief**
    Old Geezer
    6th Dec 2018
    10:33am
    Trebor an 80 year old can earn $144,000 and pay no tax.
    Misty
    6th Dec 2018
    12:01pm
    No wonder the tax system needs a shake up if that is the case OG.
    Old Geezer
    6th Dec 2018
    12:05pm
    That 80 year old will still pay no tax under Labor either.
    OnlyGenuineRainey
    6th Dec 2018
    1:17pm
    Misty, wake up to the facts before you rant in a way that makes you look dumb. Labor will look after the 80 year old with his $144,000 a year and no tax. He'll keep his franking credits - IN FULL. But the guy earning a miserable $20,000 a year who derives his income from share dividends will be taxed at 30% under Labor. And you think that's a good shakeup? You have rocks in your head if you support that kind of cruelty and unfairness.
    Misty
    5th Dec 2018
    4:07pm
    People who know politics do not vote for a PM, they vote for their local member.
    Misty
    5th Dec 2018
    4:07pm
    People who know politics do not vote for a PM, they vote for their local member.
    OnlyGenuineRainey
    5th Dec 2018
    4:27pm
    So what, Misty? If the local member is Labor, they will almost certainly support a dishonest and unfair policy, regardless of their personal views about it or the views of voters in their electorate. That's what's wrong with our system. There is NO democracy. We simply don't have choices. Both parties have the same objectives and support each other, while pretending to disagree. In the end, NOTHING is about the good of the nation or its people. It's all about power and profit for the favoured few.
    Old Geezer
    5th Dec 2018
    4:45pm
    A good friend of mine is helping the Labor candidate in a neighbouring electorate and asked me who I was going to vote for. So I said all I know is that I'm voting Labor last due to their unfair policy on franking credits. They then contacted the candidate and asked him if he know anything about it. They turned up a few days ago with the Labor press release and were very surprised when I explained it all to them. I got a phone call earlier and they tell me that the Labor candidate doesn't believe a word of how I explained it as he thought it was very unfair and Labor doesn't stand for that sort of thing.
    OnlyGenuineRainey
    5th Dec 2018
    8:03pm
    I spelled it out for my Labor MP and was completely ignored. First response was a pack of lies. When I refuted the lies with FACTS, no answer. Spelled it out for the Greens candidate and got no reply at all.
    johnp
    5th Dec 2018
    4:14pm
    would be good if someone had a sliding scale or graph as to affect on SFRs depending on level of share holdings and dividends
    Lothario
    5th Dec 2018
    4:22pm
    Everyone's circumstances is different
    Depends on your mix of fully franked , partially franked and unfranked dividend income as well as income from other sources

    For example I have positively geared investment properties so I use some of my franking credits to offset tax on rental income , and the rest on unfranked dividends . Works well as I keep my average tax rate at just under 30% to maximize credits in full
    OnlyGenuineRainey
    5th Dec 2018
    4:23pm
    It's NOT RELEVANT, Johnp. Tax is taken from their dividend. They are entitled to a refund if they are overtaxed. That's a basic principle of Australian tax law. High income earners get the benefit as a tax reduction. Rich pensioners get it. Why the hell should ANY SFR be denied, no matter what their level of shareholding and dividends? You are being discriminatory and unfair, as is the Labor Party and all supporters of this policy.

    The fact is - as any educated person knows - those with more than $1.6 million in super will retain at least some of their benefit. The richer they are, they more they retain. It is only those with LESS assets who suffer great loss. The worst hit will be those who lost up to $12,000 a year in the assets test change. Name any other group of Australians who have been asked to sacrifice $20K a year or more in income, while pensioners party on TRIPLE handouts of pension + concessions + franking credit benefits, despite the fact that many are far wealthier than SFRS but invested in expensive homes or gifted generously to offspring, or hid their wealth.

    Labor's policy is an attack on the struggling SFRs. For a party that claims to support battlers, that's grossly hypocritical. But then, what would you expect of a pack of liars who base policy on outdated 2014-5 statistics and fabricate wild myths to justify their unconscionable proposal?
    Lothario
    5th Dec 2018
    4:28pm
    Rainey - spot on again
    I feel sorry for those SFR's who are just above up to maybe $500k above the asset threshold

    They will poorer cash flow wise than pensioners, but that's what Shorten wants for you guys

    Serves you right for believing in labor .They are selling this as a cash grab from the rich, which you know is a LIE
    TREBOR
    5th Dec 2018
    7:38pm
    Thank you Lowthie for your approval of getting rid of concessional capital gains..... you already cop enough freebies on welfare....
    TREBOR
    5th Dec 2018
    8:50pm
    Like your forebear, diablo, you are truly a mine of information for the tax hunters..... though if you really had all that you claim, you wouldn't be boasting about it and revealing it all every time you attempt to argue with your betters....
    tropic
    5th Dec 2018
    6:32pm
    Macquarie Wealth Management is hardly independant. Of course they are going to say that retirees are going to suffer. It doesn't affect pensioners or part pensioners. If you are fully self managed pensioner, you are hardly suffering. And there is the option of changing to a managed super system. This tax refund is a handout which is not fair to other Australians who are taxpayers but not investors.
    Old Geezer
    5th Dec 2018
    6:53pm
    Another one that doesn't have a clue what they are talking about.
    Lothario
    5th Dec 2018
    6:55pm
    Just goes to show how labor has managed to con those who don't have much between their ears
    Some understand labor's policy and are hoping what labor steals from the modestly funded SFR\s will find its way to their pockets

    Then there are others like Mick and Trebor, who just havent got a clue
    Old Geezer
    5th Dec 2018
    7:20pm
    I put it down to the tall poppy syndrome in that they just every one down at their level. I think I have already climbed a couple of rungs higher myself.
    Misty
    5th Dec 2018
    7:46pm
    The only ones I see posting on here with tall poppy syndrome are Lothario, Old Geezer and Urainus,
    Misty
    5th Dec 2018
    7:48pm
    As well as being rude and insulting to people who have a different view to theirs, they just need to be ignored.
    Lothario
    5th Dec 2018
    7:49pm
    Misty - plkease make your case with facts, not insults. It only reflects badly on you.
    You are like Trebor . He doesnt understand tax yet calls those who pay the most tax, thieves and cheats
    OnlyGenuineRainey
    5th Dec 2018
    7:51pm
    Tropic, only a fool blinded by envy would claim self managed pensioners ''are hardly suffering''. You IDIOT. There are pensioners out there with multi-million dollar houses and hidden assets, and honest SFRS with very little real assets and low income. But pensioners - who are taking TRIPLE BENEFITS from the taxpayer purse - are the new elite, and selfish in the extreme if posts like yours are anything to go by, with not one ounce of concern for fairness, let alone respect for people whose hard work and saving is saving the taxpayer over $1 million over the course of retirement.

    Only GREEDY SCUM suggest it's acceptable to overtax SFRs while rewarding pensioners - with no regard whatever to relative means.
    TREBOR
    5th Dec 2018
    8:52pm
    You pair, OG and Loathie, could try refuting what people say with facts and references.... not your style, huh? You just think you can rubbish what they say without offering anything of substance in return.

    Clear sign of a person with no idea..... but hoping to bluff along to keep current rorts going...
    TREBOR
    5th Dec 2018
    9:12pm
    The ATO really needs a more thorough system and cases such as yours, Rainey, should be checked.

    That's always the problem with relying on the shares market for your income - it can fluctuate and even collapse....

    But be wary of saying how hard you are doing it - the Guv might 'resume' your non-productive fund and take it under 'care' and give you a handout based on their calculations. They did that with non-productive land back in the 1940's... they can do it with non-producing super funds, too, and that has already been mooted and may even be in the pipeline.

    Just saying... be wary of governments of all kinds... when they set out to catch the cheats, they always catch a lot of innocents....
    Paddington
    5th Dec 2018
    9:19pm
    I am with Misty. There needs to be more kindness on here.
    Pensioners are not a subclass as suggested by people such as OGR, Lothario, OG, et al. That kind of thing is horrible. To accuse others of being nasty like Misty who are not because they try to defend themselves. It is obvious who the culprits are. If they refrained from commenting maybe the tenor of discussion could calm down a tad and allow others who are afraid to speak up because of the abuse have a say.
    Maybe make a New Years resolution not to be so nasty on here.
    You can have your wealth if you are in that category just lay off the pensioners!
    Misty
    5th Dec 2018
    11:18pm
    Thanks for this comment Paddington, it is nice to know that there is someone commenting on here with manners.
    Misty
    5th Dec 2018
    11:26pm
    I just wish people commenting on here who have plenty of wealth, multiple homes rented out, shares etc stop calling pensioners greedy, as well as other names, I for one do not begrudge anyone their wealth regardless of how it came to them and I am sure other genuine pensioners posting here feel the same.
    OnlyGenuineRainey
    6th Dec 2018
    8:52am
    Pensioners, per se, are not a subclass. They are decent, good people who deserve respect and empathy. It is those who continue to support the unfair persecution of SFRs and the demolition of the lifestyle they worked so hard to achieve by lies and brutal abuse who are a subclass.

    Paddington, stop ranting about pensioners being exempt from Shorten's wrongful policy. That's making it far worse. He's appealing to the greed and selfishness - or the stupidity - of those who can't distinguish right from wrong and stand up for what is moral and fair. He's BRIBING pensioners to vote for a policy that is both unfair and harmful to good people, and bad for the economy.

    Misty, who the hell are you to judge who has what? Pensioners ARE supporting Shorten's unfairness, and THAT'S GREED AND SELFISHNESS. I do not look down on or denigrate anyone for being a pensioner. But stand up for what's right and fair and show respect for others. Demand that the unfair torment stop. Otherwise, you ARE guilty of greed and selfishness.
    Old Geezer
    6th Dec 2018
    9:50am
    The problem here is that people are commenting with absolute rubbish and making complete fools of themselves to those of us who know how it all works. Man up and admit you are wrong instead of trying to discredit those who know how it all works. You might actually learn something and realise that a lot of what pollies say I complete rubbish and lies. You might even contribute to a better country for all of us if you learn the rules before you type nonsense and realise the true colours of some of our pollies.
    Old Geezer
    6th Dec 2018
    9:50am
    The problem here is that people are commenting with absolute rubbish and making complete fools of themselves to those of us who know how it all works. Man up and admit you are wrong instead of trying to discredit those who know how it all works. You might actually learn something and realise that a lot of what pollies say I complete rubbish and lies. You might even contribute to a better country for all of us if you learn the rules before you type nonsense and realise the true colours of some of our pollies.
    Misty
    6th Dec 2018
    10:26am
    Only Genuine Rainey , who the hell are you to judge me, I merely said I don't care who ghas what or how they accumulated their wealth but you are continually calling pensioners greedy, I for one am sick of it if you can't be civil posting here then the moderators should BE DOING THEIR JOB AND NOT ALLOW CERTAIN POSTS OR DELETE THEM, give us a break from your ranting and raving, we know it word for word now.
    Old Geezer
    6th Dec 2018
    10:41am
    Misty To me the rudest people here are the ones that have no idea what they are on about and make complete fools of themselves.
    OnlyGenuineRainey
    6th Dec 2018
    1:14pm
    Misty, I'm not supporting theft, unfairness, and unbelievable greed that will destroy the lifestyle of innocent, hard working, frugal people who are contributing far more than their share to the economy and being hurt and denigrated in return.

    I'm sick of nasty, greedy, selfish people lobbying to cause unfair hurt to others. I think the moderators should do their job and STOP THAT KIND OF ABUSE AND THE DISHONESTY USED TO JUSTIFY IT.
    TREBOR
    5th Dec 2018
    7:14pm
    The tax man and I just love chewing up these self-confessed thieves of tax..... their day is coming.... and only a fool would try to pump up his image by boasting about how he cheats in a public forum....

    Big Bro is watching!!! And moving....
    Old Geezer
    5th Dec 2018
    7:18pm
    Unfortunately those tax thieves as you call them as miles in front of the taxman. It is only the innocent that get caught in the net.
    Lothario
    5th Dec 2018
    7:23pm
    No tax thieves here
    Only a dope called Trebor who doesn’t understand tax
    TREBOR
    5th Dec 2018
    7:39pm
    Tax as it is Loathie - that's where you miss the whole point.... but don't worry - you'll be closely acquainted with it soon.

    Now stop your personal insults .... last warning....
    Lothario
    5th Dec 2018
    7:44pm
    Give yourself a red card for calling honest taxpayers thieves and cheats . Can't get more disgusting than that
    TREBOR
    5th Dec 2018
    8:55pm
    If you are an honest taxpayer how are you living off the fat and having a low enough income to use 30% of dividends as an offset?

    Nothing honest about you, Loathie. Nothing more disgusting than a tax evader.

    Your idea of an 'honest taxpayer' is not what such will be tomorrow... get used to it.... you are getting too much for nothing, like many others.
    TREBOR
    5th Dec 2018
    8:55pm
    Of course, you could just be a fantasist....... plenty of those around.....
    OnlyGenuineRainey
    6th Dec 2018
    8:46am
    Trebor, you are clearly still hopelessly confused. I don't like Lothario or his morals or ethics, but no matter how high a person's income, they are STILL entitled to claim the franking credit against their tax bill. It's tax already paid, therefore it reduces the tax still owed.
    Even Shorten admits that and intends to allow high income earners and the wealthy to retain that benefit.


    EXAMPLE: Someone earns $180,000 a year in total - none it taxed at source except their dividend income. $20,000 is from dividends from fully franked shares, so they have had $8571 deducted from their income BEFORE it was received, leaving $171,429 in their hand. Assuming no other deductions or rebates, their tax liability is $54097. The ATO accepts that they have already paid $8571 of that, so only a further $45526 is owing.

    Shorten doesn't have any issues with that - and no matter how wealthy one may be or how high their income is, he will allow them to continue benefiting from that perfectly correct and logical system. It's only those with income below the tax threshold who will be denied the refund of that overpaid tax, and thus someone like Old Fart will pay 30% tax when they should not be liable to pay any.

    What Lothario is doing is NOT wrong in any way. He's claiming a credit for tax already paid to avoid paying it again. What Old Fart is doing is fair and moral. He's claiming a refund of tax already paid that isn't owing. According to Shorten, Lothario should be allowed to continue, because to refuse him is to make him pay double tax, but Old
    Fart should NOT be allowed his refund because by the ALP's dishonest definition, a refund of overpaid tax is a ''gift'' - UNLESS you are already getting thousands in gifts from the taxpayer in pensions and concessions, in which case you are ENTITLED to more gifts. But don't you DARE to save the taxpayer money by saving to be self-funded. For that, you wil be punished for the rest of your days.
    Old Fart
    6th Dec 2018
    1:57am
    I do not believe the lack of knowledge that some people here have on franked credits.

    This is my situation.

    I am 89 years of age and recently lost my part pension because of an asset that I cannot sell. I was one of the losers last January

    My income was $ 20,000 last year and that included some $ 3,000 cash received as dividends plus about $ 1,700 as imputed credits.

    Because of offsets I did not pay income tax.

    Now I have voted labor all of my life until now as I, like many other people in my situation, will always now put labor last.

    What Shorten wants to do is to cut my income down to $ 18,300 by stealing the tax that the company in which I hold shares had paid on my behalf. I am sure that those people who applaud this theft would be more than happy if Bill decided to stop tax refunds for those whose employers overpaid tax or who reduced the tax paid by claiming deductions.

    Looking at it another way, with an income f around $ 17,000 I would be taxed 30% of that part of the income derived from my shares.

    Is it possible that many people here cannot see the unfairness of this and the hipacrit that Shorten is when he claims that the imputed credits are a hand out by the government.

    If he is lying he does not deserve to be in government.

    If he thinks that he is telling the truth he does not know the basics in imputed credit and does not deserve to be in government.

    Perhaps he might get a nasty shock when he finds out that there are mant retirees with very small incomes who will be caught by this disgraceful theft.

    Perhaps Bill might even find that unloseable elections can sometimes be lost.
    Lothario
    6th Dec 2018
    3:02am
    Nothing I can say except on behalf of all Australian I am sorry for what Ahorten is planning to do to you and many hundreds of thousands of retirees in a similar position to you

    You are better off spending down your assets and going on a part pension to maximize your total income (pension plus personal income)

    Of course this will be at the expense of your beneficiaries AND taxpayers

    But Shorten doesn’t care
    OnlyGenuineRainey
    6th Dec 2018
    8:31am
    And that disgraceful lying hypocrite, Short-on-Brains, will STILL punish Old Fart for EVER having the temerity to be self-funded, by ensuring he can NEVER claim franking credit refunds - ever. No matter how poor he becomes. Because he wasn't a bludger or leaner or manipulator or cheat - nor among the minority of genuinely disadvantaged retired - on a random date in March 2018.

    Anyone who endorses this kind of treachery is the lowest form of SCUM - infected with the worst kind of greed and selfishness.
    OnlyGenuineRainey
    6th Dec 2018
    9:17am
    I find it perplexing that pensioners complain of being regarded as a ''sub class'', when in fact the ALP is treating low-income retirees as a ''sub class" and denying them the right of fair taxation under the laws to which all others are subjected. Those pensioners who support this ARE selfish and greedy in the extreme, or totally lacking in the intelligence to read and understand the cruelty and unfairness, not to mention economically destructive nature, of the ALP policy.

    Well, Old Fart, I guess you and I ARE a subclass - sadly lacking the intelligence to understand that this country is run by vile, corrupt, dishonest people and that diligence, honesty and integrity will always be punished harshly; too lacking in intestinal fortitude to case aside our ethics and morals and engage in the manipulation, cheating, rorting and conspiracy to pretend greater need that exists; and too proud of our contribution to society to shed our small asset holding and put our hands out for the triple benefits pensioners enjoy at our expense.

    Clearly, we struggling SFRS ARE a subclass, and as such will be ground into poverty by the selfish upper class and the greedy and envious folk who support their treachery.
    Adrianus
    6th Dec 2018
    10:38am
    Bill Shorten and his Union buddies are a vengeful lot. Don't expect a fair deal from them Rainey. Under a Labor government us SFR's are all better off on welfare.
    Old Geezer
    6th Dec 2018
    10:39am
    Many will be Adriannus.
    Old Geezer
    6th Dec 2018
    11:54am
    Here is another reason why this policy is unfair and shows another loophole in it that the wealthy will be using for their SMSFs.

    https://cuffelinks.com.au/smsfs-utilise-franking-credits-labor-policy/


    Join YOURLifeChoices, it’s free

    • Receive our daily enewsletter
    • Enter competitions
    • Comment on articles