Claiming the rebate for your spouse
If you have a spouse on the last day of the income year, and you are covered by the same complying private health insurance policy for the same period of time, you can make a choice to receive the total rebate entitlement, which may be a tax offset or a liability.
You make this choice when you lodge your tax return. You may decide to do this if:
- your spouse is not required to lodge a tax return
- you and your spouse lodge your tax returns at separate times.
One person in the relationship can choose to claim the private health insurance rebate for their spouse but they must inform their spouse so their spouse does not also claim the rebate or liability.
Example
Leo and Sam are a de facto couple who live together and share a complying private health insurance policy. They are both under 65 years old. The total cost of their policy is $4,000, but they have received a 30% premium reduction and paid $2,800 for their policy as a result.
Sam earned $180,000 as a financial consultant, while Leo spent the year undertaking volunteer work and did not earn any income. Their family income of $180,000 places them into the family tier 1 threshold where the private health insurance rebate available is 20% of the total premium.
Leo and Sam received a 30% premium reduction of $1,200. Based on their income test, they are in the family tier 1 threshold and only entitled to a 20% reduction of $800. This means that Leo and Sam have a combined (private health insurance rebate) liability of $400, and are each liable for $200.
Since Leo did not earn any income, he does not need to lodge a tax return. Sam and Leo agree that when Sam is completing his tax return, he will be income tested for his and Leo's rebate entitlement when he lodges his tax return. This means that Sam receives Leo's share of the liability.
If you and your partner decide to claim the private health insurance rebate separately, you are still income tested using the family income thresholds to determine the correct percentage of your private health insurance rebate.
Example
Abby and Jed are in a de facto relationship and are both under 65 years old. They have a combined income of $170,000 and their private health insurance policy costs $3,000, which they have paid in full without any premium reduction. Their combined income places them into income tier 1, where they are entitled to a 20% rebate as a couple ($600).
Even though they claimed the private health insurance rebate separately through their tax return, they are income tested using the family income threshold. Therefore, they each receive a tax offset of $300.
Sections within Claiming your rebate
Last Modified: Friday, 15 February 2013