Is it the same for both local and foreign shareholders?
An arrangement in Australia that eliminates the double taxation of dividends.
Double taxation of dividends occurs when both a company and a shareholder pay tax on the same income. The company pays taxes on profits and subsequently distributes a dividend out of their after-tax profits. Shareholders must then pay tax on the dividend received.
The tax imputations indicate to the government that the company issuing the dividend has already paid a portion of the tax due. The shareholder is able to reduce the tax paid on the dividend by the amount of the tax imputation credits.
Source(s):
http://www.investopedia.com/terms/d/divi...
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