Key Highlights

  • A fully franked final Dividend of $1.20 was paid on 7 October 2026.
  • FY26 Ordinary Dividends totalled $2.22 per share.
  • Each $1.20 dividend carried a franking Credit of about $0.5143, for a grossed-up value of about $1.7143.
  • The tax outcome depends on the shareholder's marginal rate and eligibility under the Holding Period rule.

Wesfarmers Limited (ASX:WES) paid a fully franked final dividend of $1.20 per share on 7 October 2026, and that payment offers a clear, current example of how franking credits work for investors researching the dividend stocks on the ASX. The Perth-based conglomerate, which owns Bunnings, Kmart Group, Officeworks and its chemicals, energy and fertilisers business, set a Record Date of 5pm AWST on 2 September 2026 for the dividend, bringing total ordinary dividends for the year to 30 June 2026 to $2.22 per share, all fully franked.

Wesfarmers' FY26 dividend details

Wesfarmers' 2026 Annual Report, including its Appendix 4E, was released to the ASX on 27 August 2026. It set out a final dividend of $1.20 per share, fully franked, following an Interim Dividend of $1.02 per share earlier in the year. The record date for the final dividend was 5pm AWST on 2 September 2026 and payment was made on 7 October 2026.

The company's dividend Investment plan operated for the final dividend without a discount and was not underwritten. The allocation price was set as the average of the daily Volume weighted average price over 15 consecutive trading days from 7 to 25 September 2026 inclusive. The election deadline was 5pm AWST on 3 September, and Wesfarmers said shares for the plan would be acquired on market and transferred on 7 October.

A worked franking credit example using the $1.20 dividend

A franking credit represents company tax that Wesfarmers has already paid on the profits used to fund the dividend. At the 30 per cent company tax rate, the credit attached to a fully Franked Dividend is the cash amount multiplied by 30/70. For the $1.20 final dividend, that is about $0.5143 per share. Adding the Cash Dividend and the credit gives a grossed-up dividend of about $1.7143 per share.

An Australian resident Shareholder includes the grossed-up amount in assessable income and then claims the franking credit as a tax offset. For someone on a 30 per cent marginal rate, tax on $1.7143 is about $0.5143, which the credit fully offsets. For someone on a 45 per cent marginal rate, before the Medicare levy, tax is about $0.7714, and after the credit about $0.2571 remains payable per share. For an eligible individual with no tax payable, excess franking credits can be refunded. Across the full FY26 dividend of $2.22, the attached credits total about $0.9514 per share.

Rules that affect franking credit eligibility

Franking credits come with conditions set by tax law. The holding period rule generally requires shares to be held "at risk" for at least 45 days, excluding the days of purchase and sale, to claim the credits. A small shareholder exemption applies where an individual's total franking credit entitlement for the year is below $5,000. Taxpayers can check how these rules apply to them using information published by the ATO (Australian Taxation Office) or by seeking personal advice.

The franking percentage depends on the company's tax paid in Australia, which is why some ASX companies pay fully franked dividends while others pay partially franked or unfranked amounts. Wesfarmers' FY26 interim and final dividends were both fully franked, so the same 30/70 calculation applies to each payment. A company that pays partially franked dividends attaches credits only to the franked portion, while an unfranked dividend carries no credit at all.

The Earnings behind the payout

Wesfarmers reported net profit after tax of $2,874 million for FY26, down 1.8 per cent, while net profit excluding significant items rose 8.3 per cent. Revenue increased 3.4 per cent to $47,274 million.

By division, Bunnings Group earnings before tax rose 5.1 per cent to $2,455 million. Kmart Group earnings before tax were $1,109 million, up about 6 per cent, and the chemicals, energy and fertilisers division delivered $473 million, up about 19 per cent. Wesfarmers Health contributed $76 million, while Officeworks earnings fell to $165 million, a decline of about 22 per cent that the company linked to transformation costs.

Managing Director and Chief Executive Officer Rob Scott said in the annual report: "Despite these challenges, Wesfarmers is well positioned to deliver satisfactory returns to shareholders over the long term."

Consumer spending and the rate backdrop

Data from Australian Bureau of Statistics (ABS) released on 4 November 2026 showed household spending rose 0.6 per cent in September, led by transport and health. A day earlier, the Reserve Bank of Australia raised the cash rate target by 25 basis points to 4.85 per cent, its fifth increase this year, saying Inflation "remains elevated" while "the economy is slowing". Consumer staples were among the sectors that moved higher on the ASX on 4 November, while industrials and materials were lower.

For retailers and other consumer-facing companies, these conditions matter because household budgets and borrowing costs influence sales, which in turn feed into profits available for dividends.

Next dates for Wesfarmers shareholders

With the final dividend paid, Wesfarmers' next dividend decision would normally come with its half-year result for the six months to 31 December 2026. The company will confirm the amount, franking and timetable at that time, along with whether the dividend investment plan will operate and on what terms.

Shareholders who want to review their tax position for FY26 dividends can use the dividend statements issued by the share registry, which set out the cash amount, the franked amount and the franking credit for each payment. Those statements, rather than estimates, are the figures normally used when completing an individual tax return, and investors in the dividend investment plan receive the same franking credits on reinvested dividends as on cash dividends.

Key Takeaways

Wesfarmers Limited (ASX:WES) paid a $1.20 fully franked final dividend on 7 October 2026, taking FY26 ordinary dividends to $2.22 per share. Each $1.20 dividend carried a franking credit of about $0.5143, for a grossed-up value of about $1.7143, with the tax outcome depending on the shareholder's marginal rate and eligibility under the holding period rule. For investors researching the dividend stocks on the ASX, the Wesfarmers example shows how franking credits can change the after-tax value of a dividend.