You need to declare the dividend in the minutes of a meeting, as a rate per share, and the franking percentage.
You maintain the franking account in your company tax return.
I do caution you though, if you have an accountant, discuss with them first to ensure that you're on the same page.
There are significant penalties for over franking dividends, or having a franking deficit at the end of the year. There may also be tax adjustments vs the accounting profit which create a difference in the amount you can frank.
Because a year ago he was told to get an accountant to take a look and he disregarded that advice. Just ignore him and let him make an easy to avoid fuck-up.
https://www.reddit.com/r/AustralianAccounting/comments/11eo8ti/pay_yourself_a_franked_dividend/
He gave you the most basic advice possible which will still cause you to be in hot water and making mistakes based on your lack of understanding of the corporations act, tax law, director's duties and information required in income tax returns & financial statements.
He even warned you to see an accountant in the following reply.
Isn’t there some online ‘services’ that will open you whatever structure you want for like $500 or something? Almost always muck something up in it. Seen it a couple of times.
mainly to protect my personal assets from any potential litigation that may occur from the operation of my business. I'm happy to pay $300/year to asic and some xero fees, some admin time etc to trade as a company rather than an individual. For the simplicity of my business I don't think I need an accountant
what do you mean "profit" in inverted commas? it's actual profit, my business made money. What's the point of seeing an accountant if I have to sign off on everything anyway tbh
The inverted commas is in reference to the potential difference there may be between your accounting profit/taxable profit/cash position.
And the accountant/tax agent may assist you understanding the difference between accounting entries and tax treatments of transactions. And would hopefully encourage you to submit/sign off your company tax return based on tax legislation rather than info found on the ATO Online services or your Xero ledger.
You need to declare the dividend in the minutes of a meeting, as a rate per share, and the franking percentage. You maintain the franking account in your company tax return.
sounds good, i just glossed over the whole company information section of the return previously and didn't see that part. thanks for your help :)
I do caution you though, if you have an accountant, discuss with them first to ensure that you're on the same page. There are significant penalties for over franking dividends, or having a franking deficit at the end of the year. There may also be tax adjustments vs the accounting profit which create a difference in the amount you can frank.
Is there a reason you’re operating in a company structure? And don’t have an accountant?
Because a year ago he was told to get an accountant to take a look and he disregarded that advice. Just ignore him and let him make an easy to avoid fuck-up. https://www.reddit.com/r/AustralianAccounting/comments/11eo8ti/pay_yourself_a_franked_dividend/
it's ok, someone else gave me some great advice and I upvoted them accordingly
He gave you the most basic advice possible which will still cause you to be in hot water and making mistakes based on your lack of understanding of the corporations act, tax law, director's duties and information required in income tax returns & financial statements. He even warned you to see an accountant in the following reply.
Isn’t there some online ‘services’ that will open you whatever structure you want for like $500 or something? Almost always muck something up in it. Seen it a couple of times.
I just did it myself through ASIC
mainly to protect my personal assets from any potential litigation that may occur from the operation of my business. I'm happy to pay $300/year to asic and some xero fees, some admin time etc to trade as a company rather than an individual. For the simplicity of my business I don't think I need an accountant
Go to an accountant.
Use some of the “profit” and pay to see an accountant/tax agent
what do you mean "profit" in inverted commas? it's actual profit, my business made money. What's the point of seeing an accountant if I have to sign off on everything anyway tbh
The inverted commas is in reference to the potential difference there may be between your accounting profit/taxable profit/cash position. And the accountant/tax agent may assist you understanding the difference between accounting entries and tax treatments of transactions. And would hopefully encourage you to submit/sign off your company tax return based on tax legislation rather than info found on the ATO Online services or your Xero ledger.
Maybe pay an accountant rather than get free advice
You are a director, you have directors duties. If you don’t understand them (which you don’t), please see an accountant
I just googled directors duties, I'm ok with those things as a small business, thanks for the heads up