SYD

Experts advising SMSFs told attendees recently to buy overseas shares to avoid problems with franking credits when Labor government takes control.  Fucking idiots!  Not all independent senators agree with Labor's policy anyway.

It is more expensive to buy overseas shares.  And more expensive to sell too.  And not easy either.

The problem for SMSF is not getting their credits back in cash but at least there is dividend imputation still with Labor policy.  With overseas shares, you cannot offset them.  My UK shares are taxed there (company tax) and I get taxed again in Australia (personal tax).

However do you collect the dividends in foreign currency?  You need to convert to AUD and that will cost you!  Or you could start a bank account for each country you invest in.  Have you ever tried to open an overseas account?  If others are collecting for you, you have another fee to pay.

If you buy unit trusts that invest overseas, a big chunk of your profit is swallowed up by the fund managers.  And many are very lazy at doing any research and they just hug the index... and get paid a huge commission.  If the overseas shares value goes up a lot, they want a bigger commission for doing "well" when they are doing nothing extraordinarily.  But if those overseas markets fell, they will tell that there is nothing they could do. And that is bullshit of course.  And they still keep the same high commission/fee!

I would tell the attendees to look at SYD...  It has no franking credit and you will have to pay tax on the income you received so there is no Labor government to deal with.  It pays a decent dividend, generated from reliable profit, year after year.  The dividend is higher than interest from bank deposit.  It has an airport monopoly for another 10 years before Western Sydney airport is opened.  Yet, commuters will still prefer the nearer airport!

And yes, there are still some well-run property trusts that pay higher than interest from deposits but I don't invest in those funds.