We’re now well into the month of June. That means many things… cold weather, short days, and end-of-financial-year sales. Maybe even a late payout from one of your ASX dividend shares. But it also means it’s nearly tax time.
Yep, from 1 July, you can lodge your tax return for the 2024 financial year. Getting your taxes in line is a task that most of us probably don’t exactly look forward to.
Hopefully, most readers will have a big refund coming their way. In the spirit of this time of year, it’s a great opportunity to think about some ASX shares you can buy if you wish to beef up your franking credit balance.
As most dividend investors would know, franking credits are a major tax perk of owning ASX shares. They enable us to claim a tax deduction for the corporate taxes our companies have already paid on the dividends they dole out to us.
Because of this transfer effect, these ‘tax-busting’ franking credits can make a significant impact on both our tax returns and overall wealth.
So, with that in mind, there are five ASX dividend shares that I would happily buy over the coming 2025 financial year that all tend to pay healthy and fully franked dividends.
5 fully-franked ASX dividend shares I’d buy to bust my taxes
Telstra Group Ltd (ASX: TLS)
First up is ASX 200 telco Telstra. Telstra has a long and well-known history of paying large, fully-franked dividend payments to its shareholders. This has continued over the past few years, with Telstra raising its most recent dividends pretty consistently.
This is a strong company with a solid financial foundation, thanks to Telstra’s dominance of both the mobile and fixed-line internet market in Australia. And that makes for a good investment from a dividend perspective.
Today, investors can expect a hefty dividend yield of around 5% if they buy Telstra stock at recent pricing.
Woolworths Group Ltd (ASX: WOW)
I have historically favoured Coles Group Ltd (ASX: COL) shares over arch-rival Woolworths when it comes to dividend income. However, the tables have turned a little in 2024, thanks to a significant drop in the Woolworths share price over the past 12 months.
I like Woolies as a dividend investment for similar reasons to Telstra: a mature business model, and a defensive earnings base.
Because Woolworths sells us goods that we need — rather than want — to buy, the company has a boosted capacity to pay out passive income in all forms of economic weather.
At recent pricing, you could nab a fully-franked dividend yield of 3.22% from Woolworths shares.
Westpac Banking Corp (ASX: WBC)
It wouldn’t be a ‘best dividend shares’ list without at least one ASX bank stock. Our big four banks enjoy some unique benefits from an investing standpoint, including government support and a loyal customer base.
Normally, my pick of the banks right now would be National Australia Bank Ltd (ASX: NAB). However, if one was prioritising dividend income, Westpac might be a better option to consider today.
This bank is currently trading on a chunky dividend yield of 5.49%. Unlike ANZ Group Holdings Ltd (ASX: ANZ) stock, Westpac’s dividends still come with full franking credits attached too.
BHP Group Ltd (ASX: BHP)
Like the ASX banks and Telstra, BHP is a renowned source of dividends on the ASX. The ‘Big Australian’ has been paying out hefty, fully franked dividends for generations.
Unlike most resources stocks, BHP has a rather diversified earning base, with the company having significant operations in iron ore, copper, potash and nickel.
Although most resources stocks tend to pay cyclical dividends, this diversified earnings base gives BHP significant wiggle room compared to some of its rivals.
BHP stock was recently trading on a fully franked dividend yield of 5.45%.
Woodside Energy Group Ltd (ASX: WDS)
ASX 200 oil and energy stock Woodside is our final dividend share to discuss. Woodside is the largest oil stock on the ASX, and a global giant. It has some of the lowest oil and gas production cost bases on the Australian markets.
Since it only deals in energy commodities, Woodside doesn’t have that diversified earnings base that lends stability to its dividend.
Even so, I think it’s a great option for income-hungry investors, because when oil and gas prices are high, Woodside tends to shower its investors with dividend cash.
At last pricing, Woodside was trading with a fully franked dividend yield of 7.92%.