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  • Income thresholds and rates for the private health insurance rebate

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    Income thresholds

    The private health insurance rebate is income tested. This means that if your income is higher than the relevant income threshold, you may not be eligible to receive a rebate. Your rebate entitlement depends on your family status on 30 June. Different thresholds apply depending on whether you have a single income or a family income.

    When you lodge your tax return, we calculate your income for surcharge purposes and determine your rebate entitlement.

    Your entitlement is also based on the age of the oldest person covered by the policy.

    The income thresholds used to calculate the Medicare levy surcharge and private health insurance rebate will remain unchanged for six years from 2015–16 to 2020–21. The thresholds remain at the 2014–15 levels during this period.

    Not adjusting the income thresholds for six years may result in individuals with incomes just below each threshold moving into a higher income threshold sooner if their income increases. This means if you:

    • have private health insurance, your private health insurance rebate percentage entitlement may decrease
    • don't have the appropriate level of private patient hospital cover, you may have to pay a Medicare levy surcharge
    • paid a Medicare levy surcharge in the previous year, your Medicare levy surcharge rate may increase.

    On this page:

    See also:

    Single income thresholds

    If you are single on the last day of the income year and have no dependants, you are income tested against the single income thresholds.

    This applies even if you had a spouse for the majority of the year, as long as you were single on the last day (30 June) of the income year.

    If you separated from your spouse during the financial year and remain single with no dependants as at 30 June, your rebate entitlement is calculated only on your own income.

    Your entitlement to a private health insurance rebate is based on your income for surcharge purposes.

    If you were single on 30 June, but had dependent children, you are considered a family and will be income tested using the family income thresholds.

    Family income thresholds

    If you had a spouse on the last day of the income year (30 June), your income will be tested against the family income thresholds. Your entitlement to a private health insurance rebate is assessed on your and your spouse's combined income for surcharge purposes.

    The family income thresholds also apply if:

    • you are a single parent with one or more dependants
    • you don't have a spouse on the last day of the income year and you either maintain a dependent child or children or contribute in a substantial way to the maintenance of a dependent child.

    If your spouse died in the income year and you were single on 30 June with no dependants, use your and your spouse's income for surcharge purposes to determine your entitlement under the family income thresholds.

    If you have two or more children, the family income threshold is increased by $1,500 for every Medicare levy surcharge dependent child after the first child. For example, if you have three dependent children, your family income threshold increases by $3,000.

    Note: None of your dependant children's income is included when calculating family income.

    Family status on 30 June

    Your family status on the last day of the income year (30 June) determines whether the single or family income thresholds apply to you. The table below provides a quick guide to when single or family thresholds apply.

    Guide to when single or family thresholds apply

    Your status on 30 June

    Single thresholds

    Family thresholds

    Whose income for the full year is included in income test?

    You were single

    Yes

    No

    Yours

    You had a spouse

    No

    Yes (see Note)

    Yours and your spouse’s

    You were a single parent

    No

    Yes (see Note)

    Yours

    You separated from your spouse during the year and were single with no dependent children

    Yes

    No

    Yours

    You separated from your spouse during the year and were single with dependent children

    No

    Yes (see Note)

    Yours

    You were single for part of the year and then had a spouse and no dependent children

    No

    Yes

    Yours and your spouse’s

    You were single for part of the year and then had a spouse and dependent children

    No

    Yes (see Note)

    Yours and your spouse’s

    Your spouse died during the year and you were single and had no dependent children

    No

    Yes

    Yours and your spouse’s

    Your spouse died during the year and you were single and had dependent children

    No

    Yes (see Note)

    Yours and your spouse’s

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    Find out about:

    2014–15 to 2020–21 Income thresholds

    2014–15 Income thresholds

    Family status

    Base tier

    Tier 1

    Tier 2

    Tier 3

    Single

    $90,000 or less

    $90,001 – $105,000

    $105,001 – $140,000

    $140,001 or more

    Family

    $180,000 or less

    $180,001 – $210,000

    $210,001 – $280,000

    $280,001 or more

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2013–14 Income threshold

    2013–14 Income thresholds

    Family status

    Base tier

    Tier 1

    Tier 2

    Tier 3

    Single

    $88,000 or less

    $88,001 – $102,000

    $102,001 – $136,000

    $136,001 or more

    Family

    $176,000 or less

    $176,001 – $204,000

    $204,001 – $272,000

    $272,001 or more

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2012–13 Income threshold

    2012–13 Income thresholds

    Family status

    Base tier

    Tier 1

    Tier 2

    Tier 3

    Single

    $84,000 or less

    $84,001 – $97,000

    $97,001 – $130,000

    $130,001 or more

    Family

    $168,000 or less

    $168,001 – $194,000

    $194,001 – $260,000

    $260,001 or more

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2010–11 and 2011–12 Income threshold

    In the 2010–11 and 2011–12 income years, we did not apply an income test for eligibility.

    Rebate rates

    Your rebate rate is the percent that you get back from your health insurance premiums in the form of a reduction of the premium or as a refundable tax offset. Your rebate entitlement depends on your family status at the end of the income year (30 June). Different thresholds apply depending on whether you have a single income or a family income.

    Find out about:

    2018–19

    If the oldest person is under 65 years old

    Rebate if the oldest person covered on your policy is under 65 years old in 2018–19

    Income for surcharge purposes

    Rebate for 1 July 2018 – 31 March 2019

    Rebate for 1 April 2019 – 30 June 2019

    $90,000 or less for a single person

    25.415%

    25.059%

    $90,001 – $105,000 for a single person

    16.943%

    16.706%

    $105,001 – $140,000 for a single person

    8.471%

    8.352%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    25.415%

    25.059%

    $180,001 – $210,000 for a family

    16.943%

    16.706%

    $210,001 – $280,000 for a family

    8.471%

    8.352%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 65 to 69 years old

    Rebate if the oldest person covered on your policy is 65 to 69 years old in 2018–19

    Income for surcharge purposes

    Rebate for 1 July 2018 – 31 March 2019

    Rebate for 1 April 2019 – 30 June 2019

    $90,000 or less for a single person

    29.651%

    29.236%

    $90,001 – $105,000 for a single person

    21.180%

    20.883%

    $105,001 – $140,000 for a single person

    12.707%

    12.529%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    29.651%

    29.236%

    $180,001 – $210,000 for a family

    21.180%

    20.883%

    $210,001 – $280,000 for a family

    12.707%

    12.529%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 70 years old or older

    Rebate if the oldest person covered on your policy is 70 years old or older in 2018–19

    Income for surcharge purposes

    Rebate for 1 July 2018 – 31 March 2019

    Rebate for 1 April 2019 – 30 June 2019

    $90,000 or less for a single person

    33.887%

    33.413%

    $90,001 – $105,000 for a single person

    25.415%

    25.059%

    $105,001 – $140,000 for a single person

    16.943%

    16.706%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    33.887%

    33.413%

    $180,001 – $210,000 for a family

    25.415%

    25.059%

    $210,001 – $280,000 for a family

    16.943%

    16.706%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2017–18

    If the oldest person is under 65 years old

    Rebate if the oldest person covered on your policy is under 65 years old in 2017–18

    Income for surcharge purposes

    Rebate for 1 July 2017 – 31 March 2018

    Rebate for 1 April 2018 – 30 June 2018

    $90,000 or less for a single person

    25.934%

    25.415%

    $90,001 – $105,000 for a single person

    17.289%

    16.943%

    $105,001 – $140,000 for a single person

    8.644%

    8.471%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    25.934%

    25.415%

    $180,001 – $210,000 for a family

    17.289%

    16.943%

    $210,001 – $280,000 for a family

    8.644%

    8.471%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 65 to 69 years old

    Rebate if the oldest person covered on your policy is 65 to 69 years old in 2017–18

    Income for surcharge purposes

    Rebate for 1 July 2017 – 31 March 2018

    Rebate for 1 April 2018 – 30 June 2018

    $90,000 or less for a single person

    30.256%

    29.651%

    $90,001 – $105,000 for a single person

    21.612%

    21.180%

    $105,001 – $140,000 for a single person

    12.966%

    12.707%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    30.256%

    29.651%

    $180,001 – $210,000 for a family

    21.612%

    21.180%

    $210,001 – $280,000 for a family

    12.966%

    12.707%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 70 years old or older

    Rebate if the oldest person covered on your policy is 70 years old or older in 2017–18

    Income for surcharge purposes

    Rebate for 1 July 2017 – 31 March 2018

    Rebate for 1 April 2018 – 30 June 2018

    $90,000 or less for a single person

    34.579%

    33.887%

    $90,001 – $105,000 for a single person

    25.934%

    25.415%

    $105,001 – $140,000 for a single person

    17.289%

    16.943%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    34.579%

    33.887%

    $180,001 – $210,000 for a family

    25.934%

    25.415%

    $210,001 – $280,000 for a family

    17.289%

    16.943%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2016–17

    If the oldest person is under 65 years old

    Rebate if the oldest person covered on your policy is under 65 years old in 2016–17

    Income for surcharge purposes

    Rebate for 1 July 2016 – 31 March 2017

    Rebate for 1 April 2016 – 30 June 2017

    $90,000 or less for a single person

    26.791%

    25.934%

    $90,001 – $105,000 for a single person

    17.861%

    17.289%

    $105,001 – $140,000 for a single person

    8.930%

    8.644%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    26.791%

    25.934%

    $180,001 – $210,000 for a family

    17.861%

    17.289%

    $210,001 – $280,000 for a family

    8.930%

    8.644%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 65 to 69 years old

    Rebate if the oldest person covered on your policy is 65 to 69 years old in 2016–17

    Income for surcharge purposes

    Rebate for 1 July 2016 – 31 March 2017

    Rebate for 1 April 2016 – 30 June 2017

    $90,000 or less for a single person

    31.256%

    30.256%

    $90,001 – $105,000 for a single person

    22.326%

    21.612%

    $105,001 – $140,000 for a single person

    13.395%

    12.966%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    31.256%

    30.256%

    $180,001 – $210,000 for a family

    22.326%

    21.612%

    $210,001 – $280,000 for a family

    13.395%

    12.966%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 70 years old or older

    Rebate if the oldest person covered on your policy is 70 years old or older in 2016–17

    Income for surcharge purposes

    Rebate for 1 July 2016 – 31 March 2017

    Rebate for 1 April 2016 – 30 June 2017

    $90,000 or less for a single person

    35.722%

    34.579%

    $90,001 – $105,000 for a single person

    26.791%

    25.934%

    $105,001 – $140,000 for a single person

    17.861%

    17.289%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    35.722%

    34.579%

    $180,001 – $210,000 for a family

    26.791%

    25.934%

    $210,001 – $280,000 for a family

    17.861%

    17.289%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    2015–16

    If the oldest person is under 65 years old

    Rebate if the oldest person covered on your policy is under 65 years old in 2015–16

    Income for surcharge purposes

    Rebate for 1 July 2015 – 31 March 2016

    Rebate for 1 April 2015 – 30 June 2016

    $90,000 or less for a single person

    27.820%

    26.791%

    $90,001 – $105,000 for a single person

    18.547%

    17.861%

    $105,001 – $140,000 for a single person

    9.273%

    8.930%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    27.820%

    26.791%

    $180,001 – $210,000 for a family

    18.547%

    17.861%

    $210,001 – $280,000 for a family

    9.273%

    8.930%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 65 to 69 years old

    Rebate if the oldest person covered on your policy is 65 to 69 years old in 2015–16

    Income for surcharge purposes

    Rebate for 1 July 2015 – 31 March 2016

    Rebate for 1 April 2015 – 30 June 2016

    $90,000 or less for a single person

    32.457%

    31.256%

    $90,001 – $105,000 for a single person

    23.184%

    22.326%

    $105,001 – $140,000 for a single person

    13.910%

    13.395%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    32.457%

    31.256%

    $180,001 – $210,000 for a family

    23.184%

    22.326%

    $210,001 – $280,000 for a family

    13.910%

    13.395%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    If the oldest person is 70 years old or older

    Rebate if the oldest person covered on your policy is 70 years old or older in 2015–16

    Income for surcharge purposes

    Rebate for 1 July 2015 – 31 March 2016

    Rebate for 1 April 2015 – 30 June 2016

    $90,000 or less for a single person

    37.094%

    35.722%

    $90,001 – $105,000 for a single person

    27.820%

    26.791%

    $105,001 – $140,000 for a single person

    18.547%

    17.861%

    $140,001 or more for a single person

    Not eligible

    Not eligible

    $180,000 or less for a family

    37.094%

    35.722%

    $180,001 – $210,000 for a family

    27.820%

    26.791%

    $210,001 – $280,000 for a family

    18.547%

    17.861%

    $280,001 or more for a family

    Not eligible

    Not eligible

    Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.

    Income tests for the private health insurance rebate

    When estimating your income for private health insurance rebate purposes, you need to think about how your circumstances may affect whether the single or family threshold applies, including:

    • whether you or your spouse expects an increased income in the income year – for example, from a promotion, change in employment, or overtime
    • your single or family status – for example, having a partner at the end of the income year
    • whether any dependent children will no longer be in your care
    • if any dependent children are        
      • turning 21 years old
      • older than 21 and under 25 years old, and no longer in full-time study.

    Each adult covered by the policy is income tested:

    • to determine their entitlement to a private health insurance rebate, regardless of who pays for the insurance policy
    • on their share of the cost of the insurance policy.

    Find out about:

    One adult covered by a policy

    If you are the only adult covered by a private health insurance policy, your share of the policy for rebate purposes is the total cost of the policy excluding any lifetime health cover loading. You are income tested to determine your private health insurance rebate entitlement regardless of who pays for the policy.

    Example: One adult covered by a policy without lifetime health cover loading

    In 2018–19, Narelle is single, 45 years old and the only adult covered by her private health insurance policy. She did not have any lifetime health cover loading.

    On 1 July 2018, Narelle nominated to receive a premium reduction of 16.943%. On 1 April 2019, the rebate percentage was adjusted. As a result, the health insurer provided Narelle with a premium reduction of 16.706% for premiums paid from 1 April 2019 to 30 June 2019.

    Narelle paid premiums monthly as follows:

    $748 between 1 July 2018 and 31 March 2019 after premium reductions of $152

    $253 between 1 April 2018 and 30 June 2018 after premium reductions of $51.

    When Narelle lodges her 2019 tax return, her income for surcharge purposes is $83,000. As her income is below $90,000, Narelle's PHI rebate entitlement is:

    25.415% for premiums paid between 1 July 2018 and 31 March 2019

    25.059% for premiums paid between 1 April 2019 and 30 June 2019.

    Because Narelle received less rebate than she was entitled to from her insurer through reduced premiums, she gets a refundable tax offset of $102 in her tax return. This offset is listed on her notice of assessment.

    End of example

     

    Example: One adult covered by a policy with LHC loading – employer pays premiums

    Peta is 50 years old and is single. In 2018–19, Peta’s employer pays for her private health insurance policy as a condition of her employment. The total cost of Peta's policy is $1,200, which includes her lifetime health cover loading of $200. This means the premiums eligible for the rebate total $1,000. Peta claims a 25.415% premium reduction for the policy, and her employer paid the remaining $946 for the policy on 1 July 2018.

    Peta lodges her 2019 tax return, and her income for surcharge purposes for the year is calculated as $99,000. Peta’s income falls into the income threshold for entitlement to a 16.943% rebate. Because Peta elected to receive 25.415% as a premium reduction, she incurs $85 liability for the extra 8.472% rebate that she had already claimed. The liability is listed on her income tax notice of assessment.

    End of example

    See also:

    Lifetime health cover

    Multiple adults covered by a policy

    If a policy covers more than one adult, the premiums paid are divided into equal shares by the number of adults covered by the policy at the time of the payment, regardless of who paid the premium or whether the adults on the policy are a part of a couple.

    Each adult’s share of the policy is equal to the total cost of the policy divided by the number of adults covered by the policy at the time of payment.

    When they lodge their tax return, each adult is income tested to determine their private health insurance rebate entitlement for their share of the cost of the policy. As each adult will be income tested according to their circumstances, there may be different outcomes for each adult.

    Example: Single adult sharing a policy

    Mike and Elle are both single and live together in shared accommodation. For convenience, they take out a private health insurance policy together in 2018–19, which is paid monthly as a joint expense of the house.

    The policy costs $1,000, which means they each have a $500 share in the policy. They do not claim the rebate as a premium reduction.

    Mike's income is $150,000 and he is not entitled to any rebate when he lodges his tax return.

    Elle's income is $55,000 and she is entitled to a:

    25.415% rebate from the government in form of refundable tax offset for premiums paid between 1 July 2018 and 31 March 2019

    25.059% rebate from the government in form of refundable tax offset for premiums paid between 1 April 2019 and 30 June 2019.

    End of example

     

    Example: Divorced adults covered by the same policy

    Charlie and Zoe got divorced in January 2019. However, they shared the same complying private health insurance policy in 2018–19. Under their family agreement, Zoe pays for her share as well as Charlie’s share of the premiums on a monthly basis. They did not pay any lifetime health cover loading.

    On 1 July 2018, Zoe nominated to receive a premium reduction of 25.415%. On 1 April 2019, the rebate percentage was adjusted and, as a result, the health insurer provided Zoe with a premium reduction of 25.059% for premiums paid from 1 April 2019 to 30 June 2019. Zoe paid premiums monthly as follows:

    • $1,119 between 1 July 2017 and 31 March 2019 after a premium reduction of $381
    • $375 between 1 April 2019 and 30 June 2019 after a premium reduction of $125.

    Charlie and Zoe will be income tested on the policy in equal shares. Any rebate entitlement they are individually eligible for applies to their own share of the policy. Their individual share of the policy is:

    • $559 between 1 July 2018 and 31 March 2019 after a premium reduction of $191
    • $187 between 1 April 2019 and 30 June 2019 after a premium reduction of $63.

    Charlie and Zoe are both under 65 years old. Zoe has an income of $106,000 and Charlie has an income of $140,200. They are both assessed under the income thresholds as single because they are not married on the last day of the income year and do not have any dependent children.

    Zoe’s individual income means that her rebate entitlement is:

    • 8.471% for premiums paid between 1 July 2018 and 31 March 2018
    • 8.352% for premiums paid between 1 April 2019 and 30 June 2019.

    When Zoe lodges her tax return for the year, she will need to pay some rebate back because she received more rebate than she was entitled to. Zoe will pay back:

    • $127 for the period 1 July 2018 – 31 March 2019
    • $42 for the period 1 April 2019 – 30 June 2019.

    Zoe will incur a private health insurance liability of $169 on her notice of assessment.

    Because Charlie’s individual income is above the top income threshold, he is not entitled to any rebate. Charlie will need to pay back:

    • $191 for the period 1 July 2018 – 31 March 2019
    • $63 for the period 1 April 2019 – 30 June 2019.

    Even though Charlie did not pay for the policy, he will receive a liability of $254 on his notice of assessment for his share of the policy.

    End of example

    Dependent children covered by a policy

    Dependent children are not income tested and their income does not count towards the income test.

    Anyone covered as a dependent child on a private health insurance policy is not considered to have a share of the cost of the policy and is not income tested to determine their entitlement to a private health insurance rebate.

    Under the Private Health Insurance Act 2007, a dependent child is either:

    • a person who is under 18 years old, or
    • a dependent child under the rules of the private health insurer who is under 25 years of age and does not have a partner.

    Your private health insurer can advise you who is covered as a dependent child on your policy.

    Example: Dependent child covered by a family policy

    Caroline and Gordon are married with a son, Archie. Archie is 19 years old, studying full time at university, and he earns $95,000 a year as a part-time model. Under the rules of their private health insurer, Archie is classified as a dependent child because he is studying full time. Because Archie is covered by the family policy, he is:

    • covered as a dependent child and his income is not taken into consideration for the family income threshold
    • not income tested for any share of the policy because he is not entitled to a private health insurance rebate
    • exempt from the Medicare levy surcharge as he has an appropriate level of private patient hospital cover for the full year.
    End of example

    Dependent child-only policies

    A dependent child covered by a child-only policy is not income tested to determine their rebate entitlement to a private health insurance rebate.

    See also:

    Last modified: 27 Jun 2019QC 49965