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Medicare levy surcharge (MLS)

Last updated 27 June 2018

The Medicare levy surcharge (MLS) is in addition to the Medicare levy. Depending on your income for MLS purposes, the MLS rate is 1%, 1.25% or 1.5% of:

  • your taxable income
  • your total reportable fringe benefits, and
  • any amount on which family trust distribution tax has been paid.

You may have to pay MLS for any period during the income year that:

For further help about this section, use the left hand side table of contents.

Completing this section

If you had private patient hospital cover during 2017–18, you will need a statement from your health insurer showing the number of days you and your dependants were covered by an appropriate level of health cover. If you do not have this statement, contact your health insurer.

Note: If you are an overseas visitor, for more information and instructions on how to complete the Private health insurance and this section, see Overseas visitors.

  1. Answer the question Were you and all your dependants covered by an appropriate level of private patient hospital cover from 1 July 2017 to 30 June 2018?
    If Yes, go to the Private health insurance section.
    If No, go to step 2.
  2. If your income for MLS purposes is below the threshold for your circumstance as outlined in table 2, myTax may advise you that you do not have to pay the Medicare levy surcharge.
    Otherwise, work out the Number of days you do not have to pay the surcharge.
    1. If you or your family were covered by an appropriate level of private patient hospital cover for only part of the year, read below to help you work out the number of days you do not have to pay the surcharge.
    2. If you were in a Medicare levy surcharge exemption category for the whole of 2017–18, you do not have to pay MLS, enter 365.
      1. If you have to pay the surcharge for:  
      2. the whole period 1 July 2017 to 30 June 2018, enter 0
      3. part of the period 1 July 2017 to 30 June 2018, enter the number of days for which you do not have to pay the surcharge.
       
     
  3. If you had private patient hospital cover for any part of the year, go to the Private health insurance section.

What if you or your family were covered by an appropriate level of private patient hospital cover for only part of the year?

If you were single and took out private patient hospital cover during the year use the following example to help you work out how many days you are liable to pay MLS.

Example: Part-year private patient hospital cover

In 2017–18, Jacinta was single and had no dependants. She had income for MLS purposes of $95,000. She was not in a Medicare levy exemption category at any time during the year.

Jacinta took out private patient hospital cover on 15 January 2018. Because Jacinta's income for MLS purposes was above the single surcharge threshold of $90,000 and she did not have private patient hospital cover for the full year, she will have to pay MLS for the part of the year that she did not have private patient hospital cover.

Jacinta will not have to pay MLS for the time she had private patient hospital cover, that is, 15 January 2018 to 30 June 2018 (167 days).

Jacinta will enter 167 at Number of days you do not have to pay the surcharge and complete Private health insurance section.

End of example

If some members of your family were covered by private patient hospital cover for the whole year and other members of your family had cover for only part of the year, use the following example to help you work out how many days you are liable to pay MLS.

Example: Part-year liability

Jill and Kevin have been married for a number of years. They have three dependent children. Jill, Kevin and their children were not in a Medicare levy exemption category at any time during the year. Jill and the children were covered by private patient hospital cover for the full income year. Kevin had his name added to the policy on 10 January 2018.

Jill and Kevin had a combined income for MLS purposes of $190,000. The family surcharge threshold for Jill and Kevin is $183,000 (that is, $180,000 plus 2 × $1,500). Because not everyone was covered for the period 1 July 2017 to 9 January 2018 and their combined income for MLS purposes exceeds the family surcharge threshold, Jill and Kevin are both liable for MLS for this period (193 days). Jill and Kevin would both enter 172 at Number of days you do not have to pay the surcharge and complete Private health insurance section.

End of example

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