Guide to Medicare levy

Overview

Medicare is the scheme that gives Australian residents access to health care. To help fund the scheme, most taxpayers pay a Medicare levy of 1.5% of their taxable income.

We will work out your Medicare levy, including any Medicare levy reduction, from the information you provide on your tax return. If you want to work out your Medicare levy, you can use the Medicare levy calculator.

Reduction for people on low incomes

Your Medicare levy is reduced if your income is below a certain threshold and in some cases you may not have to pay the levy at all. The thresholds are higher for seniors. If your income is above the thresholds, you may still qualify for a reduction based on your family taxable income.

Medicare levy exemption

You may be exempt from paying the Medicare levy if you're a foreign resident, a resident of Norfolk Island, not entitled to Medicare benefits, or you meet certain medical requirements. If you're entitled to an exemption you need to tell us on your tax return.

Medicare levy surcharge

You have to pay the Medicare levy surcharge (MLS) if your income is above a certain threshold and you (or any of your dependants) don't have appropriate private patient hospital cover. The surcharge is in addition to the Medicare levy.

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