Originally Posted by aeromedic
Romulus....THAT strategy is too close to tax fraud. It's bending the rules and these days, is quite transparent to the ATO.
Um, it's using the rules in the manner for which they are intended.
Share buybacks when properly undertaken represent a return of capital as opposed to a dividend. The ATO gets narky if they believe it is actually a pseudo dividend but where a company treats all shareholders equally (the crux of the matter in many ways) then it i tax effective, particualrly for lower tax bracket shareholders.