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    Section A: Payee's declaration

    Question 1 – What is your tax file number (TFN)?

    We and your payer are authorised by the Taxation Administration Act 1953 to request your tax file number (TFN). It is not an offence not to quote your TFN. However, quoting your TFN reduces the risk of administrative errors and having extra tax withheld. Your payer is required to withhold the top rate of tax from all payments made to you if you do not provide your TFN or claim an exemption from quoting your TFN.

    How do you find your TFN?

    You can find your TFN on:

    • your income tax notice of assessment
    • correspondence we send you
    • a payment summary or income statement your payer issues to you.

    If you have a tax agent, they may also be able to give you your TFN.

    If you still can't find your TFN, you can:

    If you phone or visit us, we need to know we are talking to the correct person before discussing your tax affairs. We will ask you for details only you, or your authorised representative, would know.

    See also:

    Questions 2 and 3

    Complete with your personal information.

    Question 4 – Do you want your payer to increase the amounts withheld from you to cover the Medicare levy surcharge?

    You are liable for the Medicare levy surcharge if you meet all of the following conditions:

    • you and your dependants (including your spouse) are not in any of the three Medicare levy exemption categories
    • you do not have private patient hospital cover for yourself, your spouse and all your dependent children
    • you are either
      • single, have no dependants and your income for surcharge purposes is more than $90,000
      • a member of a family that has a combined income for surcharge purposes of $180,000 or more. If you have more than one child, add $1,500 for the second and subsequent children.
       

    The Medicare levy surcharge is income tested against the following income tier thresholds:

    Single

    Income threshold

    Rate

    $90,000 or less

    0%

    Tier 1
    $90,001–$105,000

    1%

    Tier 2
    $105,001–$140,000

    1.25%

    Tier 3
    $140,001 or more

    1.5%

    Families

    Income threshold

    Rate

    $180,000 or less

    0%

    Tier 1
    $180,001–$210,000

    1%

    Tier 2
    $210,001–$280,000

    1.25%

    Tier 3
    $280,001 or more

    1.5%

    See also:

    If you and your spouse's combined income for surcharge purposes exceeded the family surcharge threshold described above, but your own income for surcharge purposes did not exceed $22,398, you are not liable for the surcharge for any part of the year. However, your spouse may still be liable for the surcharge.

    If you take out private patient hospital cover during the year, or cancel your cover, you may be liable for the surcharge for the part of the year when you and all your dependants (including your spouse) were not covered.

    Questions 5, 6, 7 and 8 – Claiming a Medicare levy exemption or reduction

    Do you have more than one job?

    If you are entitled to an exemption and have more than one job, you must lodge this declaration only with the payers you are claiming the tax-free threshold from.

    If you receive income from more than one source, contact us to arrange for a reduced amount to be withheld from your income from other sources.

    Full exemption

    You are entitled to a full Medicare levy exemption if any of the following apply:

    • you and all your dependants are in one of the Medicare levy exemption categories
    • you are in exemption Category 1 and your dependants had to pay the Medicare levy (for example, your only dependant is your spouse who is not in an exemption category but has to pay the Medicare levy)
    • you are in exemption Category 1 and have a dependent child who is not in an exemption category but the child is also a dependant of your spouse, who has to pay the Medicare levy.

    If you are entitled to a full exemption, answer yes at questions 5 and 6 to claim the exemption.

    Half exemption

    You are exempt from half the Medicare levy if you are in exemption category 1 and have dependants who are not in an exemption category and do not have to pay the Medicare levy (for example, they are low income earners).

    If you are entitled to a half exemption, answer yes at Question 5, no at Question 6, and yes at Question 7.

    Medicare levy exemption categories

    You are in an exemption category if you were one of the following:

    • a blind pensioner or you received the sickness allowance from Services Australia Category 1
    • entitled to full free medical treatment for all conditions under Defence Force arrangements or Veterans’ Affairs Repatriation Health Card (Gold Card) or repatriation arrangements – Category 1
    • not an Australian resident for tax purposes – Category 2
    • a member of a diplomatic mission or consular post in Australia (or a member of such a person's family and you were living with them) and you are not Australian citizen and do not ordinarily live in Australia – Category 3
    • have a certificate from the Medicare Levy Exemption Certification Unit of Services Australia showing that you are not entitled to Medicare benefits. A letter from Services Australia is not sufficient – Category 3.

    To claim an exemption you must have a Medicare Entitlement StatementExternal Link from Services Australia.

    For more information about how to apply for an exemption statement:

    Reduction based on family income

    If you are not in an exemption category, you may be able to claim a reduction based on your family income. To be eligible, you must be in one of the following categories:

    • you had a spouse (married or de facto) on the last day of the financial year
    • your spouse died during the year and you did not have another spouse before the end of the year
    • you are entitled to an Invalid and invalid carer tax offset in respect of your child
    • you were a sole parent at some time during the year and had sole care of one or more dependent children.

    If you are eligible, one of the following must also apply:

    • you are a sole parent with a gross weekly income of less than $973 or, if you have more dependants, less than the relevant amount shown in Table A
    • you have a spouse and your combined gross weekly income is less than $891 or, if you have one or more dependants, less than the relevant amount shown in Table A.

    For example, the relevant income amount for both parents with two dependent children is $1,055 a week. If your combined weekly income is less than this amount, you should answer yes at Question 8.

    If you are entitled to a reduction, answer yes at Question 8.

    Questions 9 and 10

    Complete with your personal information.

    Question 11 – Do you have a Higher Education Loan Program (HELP), VET Student Loan (VSL), Financial Supplement (FS) Student Start-up Loan (SSL) or Trade Support Loan (TSL) debt?

    Answer yes if you have a HELP, VSL, FS, SSL, or TSL debt.

    Answer no if you do not have a HELP, VSL, FS, SSL or TSL debt, or have repaid your debt in full.

    You have a HELP debt if either:

    • the Australian Government lends you money under HECS-HELP, FEE-HELP, OS-HELP, VET FEE-HELP, Vet Student loans prior to 1 July 2019 or SA-HELP
    • you have a debt from the previous Higher Education Contribution Scheme (HECS).

    You have a SSL debt if you have an ABSTUDY SSL debt.

    You have a separate VSL debt that is not part of your HELP debt if you incurred it from 1 July 2019.

    See also:

    Question 12 – Do you have dependent children?

    Answer yes if you have dependent children and write the number of children at this question.

    Find out about:

    Declaration

    Make sure that you have signed and dated the declaration.

    Give your completed declaration form to your payer.

    Section B: Payer's declaration

    This section is to be completed by the payer. The following information will help you comply with your PAYG withholding obligations.

    Payer obligations

    If you withhold amounts from payments, or are likely to withhold amounts, your payee may give you this form with section A completed. A Medicare levy variation declaration applies to payments made after the declaration is provided to you. The information provided on this form is used to work out the amount of tax to be withheld from payments based on the PAYG withholding tax tables we publish. If your payee gives you another declaration, it overrides any previous one.

    Last modified: 20 Mar 2020QC 17088