ATO HELP HECS repayment thresholds and rates
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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. For the 2022 – 23 year, your employer will start withholding HELP/HECS if your wages exceed $930 per week.

At the end of the year, when you complete your tax return, based on your RI income (RI= 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 2022 – 23 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.

Reportable Fringe Benefits

In some cases, if you are receiving reportable fringe benefit it may be wise to ask your pay office to withhold extra PAYG Withholding to cover a possible shortfall in HELP at the end of the year.

I have been asked by clients, if is it worth salary sacrificing and receiving a reportable fringe benefit with the possibility of paying extra off the HELP loan. Yes is my answer, the amount of tax saved by salary sacrificing will far outweigh any extra payments off your HELP loan, keeping in mind that any extra payments will mean that your loan will be paid off earlier.

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 2023 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.

Deceased estate

A trustee or executor needs to lodge all outstanding tax returns on behalf of a deceased person, up to the date of the person’s death.

Any compulsory repayment included on a notice of assessment or overseas levy included on a notice of overseas levy that relates to the period before the person’s death must be paid from the estate. The remainder of the debt is cancelled. Neither the deceased person’s family nor the trustee is required to pay the rest of the debt.

New HELP Rates

From 1 July 2022, all study and training loans are covered by one set of thresholds and rates.

The hierarchy in which compulsory repayments are applied to study and training loans is:

  • HELP
  • VSL
  • SFSS
  • SSL
  • TSL

If you have a HELP debt and an SFSS debt, once the HELP debt is paid off, the ATO will start apply the payment to the SFSS Debt.

Repayment income (RI)Repayment rate
Below $48,361Nil
$48,361 – $55,8361.0%
$55,837 – $59,1862.0%
$59,187 – $62,7382.5%
$62,739 – $66,5023.0%
$66,503 – $70,4923.5%
$70,493 – $74,7224.0%
$74,723 – $79,2064.5%
$79,207 – $83,9585.0%
$83,959 – $88,9965.5%
$88,997 – $94,3366.0%
$94,337 – $99,9966.5%
$99,997 – $105,9967.0%
$105,997 – $112,3557.5%
$112,356 – $119,0978.0%
$119,098 – $126,2438.5%
$126,244 – $133,8189.0%
$133,819 – $141,8479.5%
$141,848 and above10%

Example of how the payment works

For example, if your income is $58,000, you will be required to repay 2% as your income is between $55,837 – $59,186 per annum, 2% of $58,000 is $1160. It is important to note that the repayment rate is subject to change each financial year, so it is best to check with the relevant government website for the most up-to-date information.

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  1. 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.

  2. 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?

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