Fully franked dividends are dividends paid by companies that already have paid the 30 per cent company tax rate to the Australian Taxation Office. To avoid double-taxing of dividends in the hands of investors, the tax (or franking) credit gets transferred to them.
Franking (or tax) credits are handed out with dividends from many Aussie companies’ shares and they can deliver an extra income boost of up to 43 per cent for people on low and zero tax rates. This means, every dollar of franked dividend received is worth $1.43 for an investor or super fund on a zero per cent tax rate.
For example, if the Commonwealth Bank pays a dividend of $1.98 per share, for a retiree, that payment is effectively worth $2.83 per share.
Franking credits are usually refunded through a tax return, but if you do not need to lodge a tax return, you can get them using the ATO form for the relevant year. Here is the link to the 2017 financial year’s form.
It is not too late to claim a refund of franking credits you received in prior years, you just need to complete the form for the correct financial year. Just Google search “Franking credit refund form”.