ASX shares investors receive an average of $10,537 in franked dividend income per year, according to new data.
Those franking credits are proving very valuable, too — worth an average $4,217 per person per year.
Aussie investors also receive an average of $1,285 in unfranked dividend income per year.
These figures are based on recently published tax data from the Australian Taxation Office (ATO) for the 2023 financial year.
More Aussies earning dividend income
The data shows about a 10% increase in the number of taxpayers reporting both franked and unfranked dividend income in FY23.
In total, 3,045,331 Australians received franked dividend income in FY23, up 10.8% from FY22.
This is the highest number of people receiving franked dividend income since the 2010 financial year, according to historical data.
It seems that the global financial crisis (GFC) prompted many Australians to sell their ASX share investments.
The number of people declaring franked dividend income declined continuously for several years after the GFC.
It dropped from above 3 million in FY10 to a low point of 2,674,672 in FY20.
Of course, that was the first year of the pandemic.
The historical data suggests that the GFC shook the confidence of Australian investors for many years.
However, the pandemic crash and subsequent rebound seemed to inspire more people to invest in ASX shares.
The number of people declaring franked dividend income in FY21 was 150,000 higher than in FY20.
More investors target international exposure
A total of 1,315,654 Aussies received unfranked dividends in FY23, up 10.1% from FY22.
While an investor can earn unfranked dividend income from ASX shares, most of this income comes from international stocks.
The 10% increase in FY23 reflects Australian investors' increasing interest in US shares and international stocks.
FY23 was the first year of an impressive three-year bull run for the S&P 500 Index (SP: .INX).
S&P 500 stocks rose by about 16% in FY23, then 23% in FY24, and 14% in FY25.
US shares outperformed the S&P/ASX 200 Index (ASX: XJO) in each of those years, thereby encouraging more investment.
Hype around the Magnificent Seven over the past few years has also inspired more Australians to invest in US shares.
Many investors are accessing international markets via ASX exchange-traded funds (ETFs).
As of 30 June, there were 427 ASX ETFs trading on the market, according to Betashares.
The largest is the Vanguard Australian Shares Index ETF (ASX: VAS), which pays franked distributions.
The second-largest is the Vanguard MSCI Index International Shares ETF (ASX: VGS), which pays unfranked distributions.
Betashares reported more investment inflows into international ETFs than Australian shares ETFs in 2H FY25.
Australians invested about $8 billion into ETFs with international exposure compared to $6 billion in ETFs with ASX shares exposure.
Find out which ASX ETFs holding international shares gave investors the best returns in FY25 here.
