Non-resident companies, other than certain New Zealand franking companies, are not subject to the imputation system and you will not be entitled to claim a franking tax offset for any tax paid by the company.
However, you may find that foreign tax has been withheld from the dividend so that the amount paid or credited to you is reduced.
In most circumstances, you will be liable to pay Australian income tax on the dividend. You must include the full amount of the dividend at item 20 Foreign source income and foreign assets or property on your Tax return for individuals (supplementary section) 2022. This means the amount you are paid or credited plus the amount of any foreign tax which has been deducted. You may be able to claim a foreign income tax offset for the foreign tax paid.
In certain circumstances, foreign dividends may be exempt from tax. For example, they may be exempt to avoid any double taxation, or exempt because the portfolio out of which the dividends have been paid has already been taxed at a comparable rate.
