Taxing of Managed Funds - Am I missing something, page-13

OT managed funds

can i add, in respect to the ability of an LIC to claim, or otherwise, the 50% capital gains discount ........

LIC's will sometimes structure their affairs such that the dividend paid to a shareholder (usually with franking credits attached) may also come with a tax DEDUCTION for the shareholder in regards to capital gains. The $ amount of the deduction will be determined firstly by the LIC, and then secondly by the the type of tax entity that is the shareholder (by that mean if u hold the shares as an individual you get to claim a different deduction $ amount than if u hold the shares as a company, or whatevs).

Simplistically, on occasions for LIC's you will get a dividend that has franking attached, and also has a deductable amount (from capital gains) attached for use in ur tax return as a deduction to offset some of the income you banked.