Depends on what exactly is being asked here. From the time you sell shares held in a super fund and then the cash withdrawn, any unused franking credits cannot be carried through to pay an existing tax debt incurred in your own name. However, if the question is if funds are removed from one's super fund and put into one's own name and thus incur a higher taxable income when put into shares which have imputation credits attached, then can these be used to pay consequential higher tax liabilities, then of course the answer is yes. I read that post as referring to the former, not the latter. If funds are held in assets such as term deposits and shares which do not pay any imputated dividends, then it is possible to utilise any excess franking credits to pay any tax liability which they may incur. Not sure whether that $40k re SAPTO is correct, as I am in a similar situation and certainly pay tax without a $40k nontaxable component.
Best to get accounting advice is my opinion and here is not the best place to seek definitive information.
