Medicare Levy & Medicare Levy Surcharge Explained
To have access to a great public healthcare system, most Australian residents pay the Medicare Levy, which is 2% of taxable income.
Foreign residents and some low wage earners are exempt from the Medicare Levy.
For example, a person with two young children earning less than $30,000 will not pay the Medicare Levy.
The Medicare Levy Is DIFFERENT To The Medicare Levy SURCHARGE
Singles who have a total income of more than $90,000 and families or couples earning more than $180,000 will pay an additional tax known as The Medicare Levy Surcharge unless they hold adequate private health insurance.
The income thresholds for the surcharge include Super contributions, fringe benefits and net investment losses.
For example, Greg and Sheila have combined total income of $200,000 but no private health insurance. They will pay the Medicare Levy Surcharge in addition to the Medicare Levy.
By having private health insurance cover for the entire tax year, Greg and Sheila may not be liable for the extra surcharge.Did you know Rask Education offers investing, budgeting, tax and finance courses? Here are the three most popular: Absolutely no credit card or payment information required -- all you need is an email address!