Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) While recognising that an entity may anticipate * franking credits when * franking * distributions, the object of this section is to prevent those credits from being anticipated indefinitely by requiring the entity to reconcile its * franking account at certain times and levying tax if the account is in * deficit.
Franking deficit at end of income year
(2) An entity is liable to pay franking deficit tax imposed by the New Business Tax System (Franking Deficit Tax) Act 2002 if its * franking account is in * deficit at the end of an income year.
Corporate tax entity ceases to be a franking entity
(3) An entity is liable to pay * franking deficit tax imposed by the New Business Tax System (Franking Deficit Tax) Act 2002 if:
(a) it ceases to be a * franking entity; and
(b) immediately before it ceases to be a franking entity, its * franking account is in * deficit.
Note: The tax is imposed in the
New Business Tax System (Franking Deficit Tax) Act 2002 and the amount of the
tax is set out in that Act.