FDR Exclusion List

Background

The Income Tax Act 2004 has been amended to provide new rules for taxing offshore portfolio investment in shares. The main changes are that foreign investment funds (FIF’s) are now taxed under the new fair dividend rate (FDR) method.

Under the new rules investments in Australian-resident companies listed on an approved index of the Australian Stock Exchange, such as the All Ordinaries index (the 500 largest listed companies) are excluded from the FIF rules and are taxed the same as New Zealand investments.

We have published this list so that you may check whether any of your Australian shareholdings are excluded from the new FIF taxation rules.

Under the FDR method investors who invest in FIF’s with a total portfolio that value exceeds a threshold amount are taxed on a percentage of their total return (capital gains and dividends).

Sharesight also helps all subscribers, including free trial users, to determine whether they will be subject to the new FIF taxation regime. A detailed FIF income report under the FDR and CV methods is available to subscribers on Sharesight’s Expert plan. The Sharesight FIF report saves subscribers from having to wade through the complexities of FIF taxation and saves considerable amount of time as well. Click here to find out more. To use the report, please sign up for a free trial