🇦🇺Australia

Franking Deficit Tax (FDT) Liability & Late Lodgement Penalties

1 verified sources

Definition

Companies must maintain accurate franking account records and lodge returns on or before 31 July following year-end (or 30 June if elected). Failure to lodge or late lodgement triggers penalties; debit balances incur FDT liability. Manual processes create reconciliation errors and missed deadlines.

Key Findings

  • Financial Impact: Estimated: AUD 10,000–50,000 per annum per entity (penalties + interest + remediation labour: ~40–60 hours/year at professional rates)
  • Frequency: Annual (31 July deadline) or rolling (monthly for active franking companies)
  • Root Cause: Manual franking account tracking, complex dividend timing, insufficient system integration between dividend ledgers and tax records

Why This Matters

The Pitch: Australian listed companies and franking entities waste between AUD 10,000–50,000 annually in penalties, interest charges, and manual compliance labour for tracking franking positions. Automated franking account monitoring eliminates late filing penalties and FDT miscalculations.

Affected Stakeholders

Tax Compliance Officer, CFO/Finance Manager, Company Secretary, External Accountant

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Financial Impact

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Current Workarounds

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Methodology & Sources

Data collected via OSINT from regulatory filings, industry audits, and verified case studies.

Evidence Sources:

Related Business Risks

Australia Post Cost Allocation & Mail Service Inefficiency Losses

Estimated: AUD 5–15 million annually across Australian mailers (cumulative impact of 13.3% price increase on bulk mail volumes + hidden overhead allocation inefficiency)

Franking Credit Valuation & Capital Structure Misallocation

Estimated: AUD 500 million–2 billion (0.5–2% of ASX 200 combined market cap), or ~AUD 50,000–200,000 per company per annum in suboptimal capital decisions

Travel Claim Audit Failures & Disallowed Expenses

AUD 5,000–15,000 per disallowed claim; 20–40 audit hours per agency annually = AUD 4,000–8,000 in remediation labor; typical agency exposure AUD 40,000–80,000 over 2 years

Delayed Travel Reimbursement & Acquittal Processing

10–30 day payment delay per claim; typical parliamentary/legislative office: 15–30 travel claims/month = AUD 5,000–15,000 in reimbursement float; employee cash-flow loss + administrative cost AUD 2,000–5,000/month

Manual Travel Form & Receipt Administration Bottleneck

15–25 hours/month per coordinator @ AUD 45/hour = AUD 675–1,125/month = AUD 8,100–13,500/year per coordinator; typical Legislative Office: 2–3 coordinators = AUD 16,000–40,000 annual labor waste

Failure to Achieve 'Lowest Logical Fare' & Non-Compliance Booking Costs

Average 8–15% fare premium on non-optimized bookings; typical Legislative Office: 100–150 flights/year @ AUD 500–800 avg = AUD 50,000–120,000 travel budget; 10% waste = AUD 5,000–12,000/year; missed frequent flyer utilization = AUD 3,000–8,000/year

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