Medicare levy - a growing tax

Medicare provides Australian residents access to health care. It is partly funded by taxpayers, who pay a Medicare levy of 2 per cent of their taxable income.

In recent years, the Medicare levy has risen from 1 per cent to 2 per cent, and in addition, it is now calculated on fringe benefits, which did not used to appear on group certificates.

Medicare levy is reduced if taxable income is below a certain threshold. Note that some taxpayers are exempt from the Medicare levy because of their foreign earnings status, or the type of health care which is provided to them.

If your taxable income is above the thresholds, you may still qualify for a reduction, based on your family taxable income.

The Australian Taxation Office website outlines here whether you can qualify for a Medicare levy reduction.

For more information, we advise you to make an appointment with your nearest TaxAssist Accountant for a free, initial consultation.

Date published 8 Feb 2017

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.