Dividends and DRP

Discussion in 'Share Investing Strategies, Theories & Education' started by Tony, 17th Mar, 2018.

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  1. Tony

    Tony Well-Known Member

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    Quick question regarding Fully Franked Dividends and participation in DRP.

    Company A has Income of $100 which equates to a dividend of $70 and franking credit of $30

    Full participation in DRP and share price is $10 at the time.

    Is the full income of $100 (i.e. 10 shares @ $10) used in the DRP or just the dividend portion of $(i.e. 7 shares @ $10)?

    Thank you
     
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  2. asw1

    asw1 Well-Known Member

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    Hi Tony,
    DRP is only issued on the cash balance that you would receive. Franking credits are used only at tax time to either claim a refund or lower the taxable income from the ATO.

    So you would only receive 7 shares @ $10.
     
  3. Tony

    Tony Well-Known Member

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    Thank you
     
  4. D.T.

    D.T. Specialist Property Manager Business Member

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    Still declare div income too even though it went directly to more shares
     
  5. Marg4000

    Marg4000 Well-Known Member

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    Absolutely.

    You do want your franking credits, don’t you!
    Marg
     

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