With 30 June just gone by, eligible not-for-profit (NFP) organisations—especially registered charities that have received franked dividends during the 2025 income year—are reminded to lodge their Franking Credits Refund Application (ATO Form NAT 4131) to receive a cash refund for the franking credit component.
When a company distributes profits to shareholders as dividends, it may also pass on the benefit of tax it has already paid—this is known as a franked dividend. The attached franking credit represents the tax already paid by the company and can usually be used to offset the shareholder’s own tax liability.
For NFPs, franked dividends may come from:
Most NFPs are income tax exempt, meaning they can’t use franking credits to reduce tax—because they don’t pay any. Without action, these credits would go to waste.
Fortunately, the tax law allows certain eligible NFPs to claim a refund of these credits as a cash payment from the ATO.
Eligible organisations include:
For full eligibility details, visit the ATO’s Eligibility for a Refund page.
There is no time limit to lodge a refund claim for past years.
However, only one application per income year is allowed.
If you make an error, you’ll need to contact the ATO to amend it—time limits may apply to corrections.
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