Authorised Investment Fund Limited (AIY) was set up and registered as a Pooled Development Fund (PDF) in accordance with the provisions of the Pooled Development Funds Act 1992. Authorised Investment Fund Limited invests in small to medium sized companies providing them with patient equity capital to assit the business development and expansion of those companies. Authorised Investment Fund Limited was listed on the Australian Stock Exchange (ASX) in 1999. The ASX code is AIY.
About a Pooled Development Fund (PDF)
Tax Benefits of Investment in Pooled Develeopment Fund
- Tax concessions - companies registered as pooled development funds and their shareholders can access certain tax concessions on income derived from PDF investments.Taxation treatment of dividends paid by PDFs to their shareholders - Unfranked dividends paid by a PDF are tax exempt in the hands of shareholders. Franked dividends paid by a PDF are also tax exempt in the hands of shareholders, unless the shareholder elects to be taxed. Where shareholders elect to be taxed, they can use the imputation credits attached to the franked dividend to offset other tax obligations.
- Taxation treatment of capital gains made on the sale of shares in PDFs - The capital gains on realisation of shares held in a PDF are tax exempt.
- Taxation treatment of PDF income - The income derived by PDFs from investments in companies, whether dividend, capital gains or other income, is taxed at 15 per cent rather than the full corporate tax rate. PDFs credit their franking accounts for tax paid but may frank a distribution up to the general corporate rate of 30 per cent. This enables them to pass on a greater franking benefi t to their shareholders than would otherwise be warranted by the tax they have paid, where they have a surplus in their franking account.
For advice about the tax concessions which may be available to PDFs and shareholders in PDFs, you should contact the Australian Taxation Office.
Source: the above has been quoted from PDF Administration Board annual report.