Medicare Levy Surcharge

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What’s the Medicare Levy Surcharge (MLS)?

To understand the Medicare Levy Surcharge (MLS), it helps to know a bit about Medicare and the Medicare Levy.

Medicare gives eligible residents access to public health care. It’s partly funded by taxpayers who pay a Medicare levy of 2% of their taxable income.

The Medicare Levy Surcharge (MLS) is an additional levy of up to 1.5% that’s imposed on individuals who earn above a certain income, and don’t have an appropriate level of private Hospital cover.

How does it affect me?

It will only affect you if your income is more than $90,000 (or $180,000 for families*), and you don’t have an appropriate level of Hospital cover.

Select the income bracket that applies to you to determine your MLS.

Singles Income Medicare Levy Surcharge
$90,000 or less No surcharge applies
$90,001-105,000 1%
$105,001-140,000 1.25%
$140,001 or more 1.5%
Families Income Medicare Levy Surcharge
$180,000 or less No surcharge applies
$180,001-201,000 1%
$201,001-280,000 1.25%
$280,001 or more 1.5%

*The family income threshold is increased by $1,500 for each child after the first child.

To work out your annual income for MLS purposes, you can refer to the Australian Taxation Office’s Private Health Insurance Rebate Calculator or talk to your tax adviser.

The real cost to you

Let’s say you have a single income of $95,000 for MLS purposes. Without Hospital cover, you could be paying around $950 more at tax time – money that could otherwise be used towards protecting your health.

To avoid the MLS, take out any level of our Hospital or Package cover today.

Things to know

  • The income thresholds are effective 1 July and are indexed annually.
  • To avoid the MLS each year, you need to hold the appropriate level of private Hospital cover for the full tax year.
  • For more information on the MLS, including when the levy applies and surcharge thresholds, please visit ato.gov.au or talk to your tax adviser.