Menu

Conduit Foreign Income

Conduit Foreign Income (CFI), is the component of dividends received from Australian corporate tax entities (i.e. Australian listed companies on the ASX: NAB, Rio etc.) that is exempt from withholding tax.

Generally, it is foreign income earned by/ through an Australian corporate tax entity (i.e. BHP Billiton Global Operations in Malaysia and Algeria) that is received by non-tax resident investors.    

Ordinarily, any foreign income paid to a non tax Australian resident, is exempt from any Australian tax.  CFI in its nature is non-assessable, non-exempt income (effectively tax free).  Therefore, any unfranked distribution with a portion of CFI is not subject to withholding tax.

However, for Australian resident investors, any amounts of CFI will be claimed a part of an ‘unfranked dividend’.  Therefore subject to any tax implications that come with unfranked dividends. 

"Chris Humphrey Private Wealth Management has helped my family with professional financial advice on a number of occasions. Specifically, Chris recently helped me to make decisions regarding my salary packaging options. Chris and his team are always proactive and quick to respond to queries. Chris’ advice has always been relevant and informative, enabling us to make careful decisions about our financial situation and planned future. "

Kirsten Cowan