Franking Credits Calculator Australia (Dividend Imputation)
Calculate the tax impact of franked dividends in Australia. This calculator estimates your franking credits, grossed-up dividend amount, and whether you receive a refund or pay top-up tax.
Based on 2025-26 tax rates. Supports fully franked, partially franked, and unfranked dividends.
The dividend amount paid to you (before any tax)
100% = fully franked, 0% = unfranked
Most large ASX companies use 30%. Check your dividend statement.
Your taxable income excluding this dividend
Enter dividend details to calculate your franking credits
How Franking Credits Work
Australia's dividend imputation system prevents double taxation of company profits. When a company pays tax on its profits and then distributes dividends, shareholders receive a "franking credit" for the tax already paid.
The Franking Credit Calculation
For a fully franked dividend at the 30% company tax rate:
Franking Credit = Cash Dividend × (Tax Rate ÷ (1 - Tax Rate))
Example: $100 × (0.30 ÷ 0.70) = $100 × 0.4286 = $42.86
The grossed-up dividend ($142.86) is your assessable income. You pay tax on this amount at your marginal rate, then subtract the franking credit.
Who Gets a Refund?
You'll receive a franking credit refund if your marginal tax rate (including Medicare levy) is lower than the company tax rate:
| Taxable Income | Marginal Rate | vs 30% Company Rate | Result |
|---|---|---|---|
| $0 – $18,200 | 0% + 2% ML = 2% | 2% < 30% | Full refund |
| $18,201 – $45,000 | 16% + 2% ML = 18% | 18% < 30% | Partial refund |
| $45,001 – $135,000 | 30% + 2% ML = 32% | 32% > 30% | Small top-up |
| $135,001 – $190,000 | 37% + 2% ML = 39% | 39% > 30% | Top-up required |
| $190,001+ | 45% + 2% ML = 47% | 47% > 30% | Larger top-up |
Worked Example
Sarah receives a $1,000 fully franked dividend from BHP. Her taxable income is $75,000.
| Step | Calculation | Amount |
|---|---|---|
| Cash dividend | Amount received | $1,000.00 |
| Franking credit | $1,000 × (30% ÷ 70%) | $428.57 |
| Grossed-up dividend | $1,000 + $428.57 | $1,428.57 |
| Tax at 32% marginal | $1,428.57 × 32% | $457.14 |
| Less franking credit | -$428.57 | |
| Net tax on dividend | $28.57 |
Sarah pays an additional $28.57 in tax on her $1,000 dividend — an effective rate of just 2.86%.
The 45-Day Holding Rule
If your total franking credits for the year exceed $5,000, you must satisfy the "holding period rule":
- Hold ordinary shares for at least 45 days (excluding purchase and sale days)
- Hold preference shares for at least 90 days
- The holding period must be around the ex-dividend date
- Shares must be held "at risk" (not hedged or protected)
Small shareholder exemption: If your total franking credits are under $5,000 for the year, the holding period rule doesn't apply and you can claim all your credits.
Company Tax Rates
| Company Type | Tax Rate | Franking Credit per $1 |
|---|---|---|
| Standard companies (most ASX) | 30% | $0.4286 |
| Base rate entities (small business) | 25% | $0.3333 |
Check your dividend statement to confirm which rate applies. Most large ASX-listed companies use the 30% rate.
FAQ
What is a franking credit?
A franking credit (also called imputation credit) represents tax the company has already paid on its profits. When you receive a franked dividend, you get credit for this tax. If your personal tax rate is lower than the company rate, you may get a refund of the excess.
How do I calculate the grossed-up dividend?
The grossed-up dividend is the cash dividend plus the franking credit. For a $100 fully franked dividend at 30%: $100 + ($100 × 30% ÷ 70%) = $100 + $42.86 = $142.86.
Can I get a franking credit refund?
Yes, if your marginal tax rate is lower than the company tax rate (30% or 25%), you'll receive the excess franking credit as a cash refund. This commonly happens for low-income earners, retirees, and those with taxable income under $45,000.
What is the 45-day holding rule?
If your total franking credits for the year exceed $5,000, you must hold shares "at risk" for at least 45 days (90 days for preference shares) around the ex-dividend date to claim the credits. This prevents dividend stripping.
What's the difference between 25% and 30% franking?
Most large Australian companies pay tax at 30% and frank dividends at this rate. Smaller "base rate entities" pay 25% company tax and can only frank at 25%. Check your dividend statement for the applicable rate.
Do I need to declare franked dividends?
Yes, you must declare the grossed-up dividend (cash + franking credit) as assessable income in your tax return. The franking credit is then applied as a tax offset. The ATO pre-fills most dividend information from share registries.
Tax Accuracy & Sources
This calculator is an estimate tool and may not cover all personal circumstances. For state-based taxes, confirm details with your state or territory revenue office.
Last reviewed: February 2026. Based on current ATO dividend imputation rules.