The video provides the following guide to using the Share Register & Franking Account -
- Creating a class of shares and authorised share capital with a distinct face value per share
- Issuing shares from the authorised capital to the active entity members
- Transferring or recording member-to-member shares
- Disposing of shares (capital reduction)
- Understanding how adding members in the share register updates the relationships module
- Setting up the franking account
- Adding a balance to the franking account
- Adding a transaction in the franking account
- Paying franked and unfranked dividends
- Understanding how notating the company as SBE changes the rate of franking to equate to either 30% tax rate or 27.5% tax rate
Notes:
- In the Financial Information Section, franking account must be positive or zero. Not negative.
- Dividend franking credits are not usually reflected in accounting income so I think it's reasonable to expect a difference between tax and accounting income.
- If a new company, there will be no franking account balance until tax is paid.
- Ensure that you have followed the instructions for importing the tax account into the Income Tax Validator from the ATO Portal web page.
- Make sure the date range covers the tax paid.
- Tax instalments can be imported from the Integrated Account while the balance of tax can be imported from the Income Tax Account.
- Be sure to select the right type of transaction to import to your Franking Account.
Manual Transactions can be added to the Franking Account where necessary
Note: The franking account balance should be managed either through the Franking Account tool or directly within the tax return. Mixed-mode processing is currently not supported.
Franking Account Processing (Manual vs. Automated)
LodgeiT supports two processing modes for posting credits and debits to your tracking registry.
1. Automated Process (Recommended): Use this default flow to automatically calculate and apply corresponding transaction debits directly to the franking account.
Navigate to your profile settings menu. Find the configuration toggle. Tick the box for "Automate franking rate" to lock automated distributions to the standard 25% base rate.
2. Manual Tool (Franking Credits Distributed): Use this specialized function when you need to manually force an override or apply standalone adjustments outside standard automation workflows.
This manual override feature is explicitly labeled "Franking credits distributed" to prevent confusion with full automation tools.
3. Paying Dividends
> Log a transaction line item within your franking log screen.
> Declare the exact distribution amount per active share class.
> Save changes to finalize reporting values on your active tax schedules.