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Your household income at tax time

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So, there’s been an increase to your household income… let’s find out how this affects your health insurance.

The Medicare Levy Surcharge (MLS) was established by the Australian Government to encourage people on higher incomes to take out health insurance. Put simply, you pay more tax if you are a high income earner and do not have eligible private health insurance.

Understanding what income tier you fall into may also help you decide if you are better off investing in health cover… because the more you earn, the more you are penalised.

Income vs MLS vs Government Rebate
Single $90,000 or less $90,001 – $105,000 $105,001 – $140,000 $140,001 or more
Families $180,000 or less $180,001 – $210,000 $210,001 – $280,000 $280,001 or more
Medicare Levy Surcharge 0% of taxable income 1.0% of taxable income 1.25% of taxable income 1.5% of taxable income
Government Rebate 27.820% 18.547% 9.273% 0%

 

For example, if you are currently uninsured and earn $95,000 as a single person, you will paying an extra 1% of taxable income at tax time. That’s $950.

Alternatively, you could purchase a basic hospital and extras cover for under $1,000 – not only will you avoid paying this extra tax, but you’ll be able to claim on services such as ambulance, hospital, dental, physio and more.

There are lots of great cover options to consider from dozens of trusted Australian health funds. To find your perfect health insurance, Choosewell can ask you the right questions and get you started on the right cover.

Already a member?
If you’re already a member of a health fund and have had an increase to your household income in the past year, you need read this.

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