ATO HELP HECS repayment thresholds and rates

Have you or are you currently studying at university? If so, you are likely to have a HELP/HECS debt.

Notifying your Employer

You are required to let your employer know that you have a HELP debt, this can be done via an Employment Declaration form at the commencement of your job or at any time thereafter should you start studying. Your employer will withhold extra tax to cover your end of financial year HELP repayment when your tax return is completed.

At the end of the year, when you complete your tax return, based on your HRI income (HRI= Taxable income plus any total net investment loss, which includes net rental losses, total reportable fringe benefits amounts, reportable super contributions and exempt foreign employment income.) the ATO will calculate how much HELP will need to be paid. The rates for the 2017 – 18 year are set out in the table below.

The HELP is calculated based on your HRI income and the extra tax that has been taken out of your wages by your employer is in most cases enough to offset the amount of HELP due.

Voluntary Repayments

Voluntary repayments can be made at any time, as from the 1st January 2017 the repayment bonus is no longer available. The payments are in addition to the compulsory payments and are not refundable.

Living Overseas

If you have been living overseas and you have a Higher Education Loan Program (HELP) or Trade Support Loan (TSL) for the year ending 30th June 2017 you will be required to lodge a worldwide income report to the ATO via the MyGov website and if the amount in Australian dollars is greater than the thresholds below then you must make a compulsory payment off your loan.

2017 Federal Budget

The changes to the HELP debt as from the 1st July 2017 for the year ending 30th 2018 will see the minimum income, to start repaying HELP debt, be lowered to $42,000. The repayment rate will increase with income, from 1% at the minimum threshold to 10% at A$119,882, the maximum threshold.
**Note – As you can see by the rates from the ATO below, the 2017 Federal Budget changes were not implemented.

 

2017–18 repayment income thresholds and rates for HELP, SSL, ABSTUDY SSL and TSL

 

Repayment income (RI*)Repayment rate

Below $55,874

Nil

$55,874 – $62,238

4.0%

$62,239 – $68,602

4.5%

$68,603 – $72,207

5.0%

$72,208 – $77,618

5.5%

$77,619 – $84,062

6.0%

$84,063 – $88,486

6.5%

$88,487 – $97,377

7.0%

$97,378 – $103,765

7.5%

$103,766 and above

8.0%

2016 – 2017 HELP Repayment Thresholds

 

Repayment income (RI*)Repayment rate

Below $54,869

Nil

$54,869 – $61,119

4.0%

$61,120 – $67,368

4.5%

$67,369 – $70,909

5.0%

$70,910 – $76,222

5.5%

$76,223 – $82,550

6.0%

$82,551 – $86,894

6.5%

$86,895 – $95,626

7.0%

$95,627 – $101,899

7.5%

$101,900 and above

8.0%

3 Comments

  1. As uni grad I had a taxable income of less than $43,151 for the 09/10 Financial year. As I was employed on a salary for only part of the financial year and my employer withheld HECS repayments as per the indicative rate. I was entitled to a tax refund, yet the ATO still took part of that refund and applied it to my HECS debt? How does this work if I was below the $43,151 threshold and I had no reportable fringe benefits? If I received the extra money I could have made a voluntary contribution to my HECS debt and received a bonus 10% on that payment. This seems wrong and typical of the ATO??

    Can anyone shed some light?

  2. is there anyway you can list of the payments your employer makes to hecs in a year?

    1. Your employer should show on your payslip the amount of extra tax with held to cover your HECS/HELP/SFSS debt. The amount of HECS with held from your wage isn’t paid directly off your HECS account at the Australian Taxation Office.
      Only one payment per year is is made to your HECS account which is made when your income tax return is lodged.
      When your tax return is being calculated, the total tax payable includes, the income tax, plus medicare levy, less tax offsets, plus any HECS debt. The total of the amounts should be covered by the normal tax with held plus any HECS amounts with held.
      As there is no regular payments made off your HECS debt apart from the annual payment when your tax return is lodged, there is no list.

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