Understanding the Medicare Levy Surcharge and how to save tax.
The Medicare Levy Surcharge (MLS) is a Federal Government initiative to encourage individuals to take out private hospital cover, and where possible, to use the private system to reduce the demand on the public system. The MLS is levied on Australian taxpayers who do not have private hospital cover and who earn above a certain income. The income thresholds increase incrementally, as does the MLS itself, depending on your adjusted taxable income.
Will the MLS affect your stay in Australia?
For further information on how the Medicare Levy Surcharge applies to you, tax advice please visit Overseas visitors | Australian Taxation Office (ato.gov.au) or contact your accountant.
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The current Adjusted Taxable Income thresholds are outlined in the table below:
| POLICY TYPE | ADJUSTED TAXABLE INCOME |
|---|
SINGLE
COUPLE/FAMILY | $97,000 or less
$194,000 or less | $97,001 - 113,000
$194,001 - 226,000 | $113,001 - 151,000
$226,001 - 302,000 | $151,001 or more
$302,001 or more |
| APPLICABLE MLS | 0% | 1.0% | 1.25% | 1.5% |
Please note: The thresholds increase annually based on growth in Average Weekly Ordinary Time Earnings. Single parents & couples (including de facto couples) are subject to family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.