 But schemes involving a deliberate arrangement by a company's owners to avoid tax are addressed by anti-avoidance provisions of Part IVA the Income Tax Assessment Act 1936.

Dividend stripping by investors has the general advantages or disadvantages described above, but in addition in Australia there are franking credits attached to dividends under the dividend imputation system.Those credits can only be used by eligible investors (see the dividend imputation article), so there's a tension between different investors for the amount shares should fall when going ex-dividend.A rationally priced drop for one group is a bonus or trading opportunity for the other.