Do ETFs pay dividends?

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1 Answer 947
Oliver Irwin

Answered 8 months ago

ETFs pay distributions that are similar to the dividends you might receive on other shares — the difference being the frequency of the payments. Companies that pay regular dividends generally do so twice yearly, whereas funds usually pay quarterly distributions.   

If your ETF is invested in shares, you might be entitled to a proportion of the dividends those listed companies pay. Dividends come from profits. Each company makes its own decision as to the proportion of earnings it will pay to shareholders. 

Some Australian companies pay franked dividends, which means you will receive franking credits. Franking credits give you a tax credit for the tax already paid by each company on its profits. 

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