How are dividends taxed in Australia?

Dividends are taxed at your marginal rate, but franked dividends come with franking (imputation) credits for the 30% company tax already paid. You 'gross up' — add the credits to the cash dividend — pay tax on the total, then subtract the credits. If your marginal rate is below 30% you get the excess credits back as a refund; above 30% you pay a little extra.

What are franking credits worth to me?

Franking credits offset your tax bill dollar-for-dollar, and any excess is refunded. For a retiree or low-income earner on a 0% or low marginal rate, a fully-franked 4% dividend can be worth over 5.7% grossed-up. For a top-rate earner, the credits cover part of the tax but you still pay the gap up to 47%.

What is the gross-up on a franked dividend?

The gross-up is the cash dividend plus the attached franking credits — it's the amount the ATO treats as your taxable income. A $700 fully-franked dividend carries $300 of franking credits (at the 30% company rate), so the grossed-up taxable figure is $1,000. You then pay marginal-rate tax on $1,000 and claim the $300 credit.

Dividend Income Calculator

Work out the real, after-tax income from a share or ETF portfolio — including franking credits and the gross-up — so you can see what your dividends are actually worth to you.

Last verified: 5 May 2026

How much dividend income will I keep after tax?

Franked dividends carry franking credits for the 30% company tax already paid. You gross up, pay marginal-rate tax, then subtract the credits — so a low earner gets a refund and a top earner pays the gap. Source: ATO.

Worked example. $200,000 at a 4% fully-franked yield = an $8,000 cash dividend + ~$3,430 franking credits. At a 32% marginal rate you keep about $7,400 after tax; on a 0% rate the credits would be fully refunded.

General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.

From the Mate Network

Check Your Take-Home Pay →

See your marginal rate — it drives your dividend tax.

Dividend Income Calculator

How much dividend income will I keep after tax?

Related reading

Related Tools

From the Mate Network