Want 1 month of free health insurance?
Let’s start with the Medicare Levy Surcharge (MLS)
As Australian residents we all have the right to health care through Medicare, a system partly funded by taxpayers, many of whom pay a Medicare levy of 2% of their taxable income. Your Medicare levy is reduced if your taxable income is below a certain threshold, meaning that some people may not have to pay the levy at all.
However, if you don’t have appropriate hospital cover and your annual income* is over $90,000 as a single, or over $180,000 as a couple/family then you could also be hit with the MLS. The family income threshold is increased by $1,500 for each MLS dependent child after the first child.
This means, when tax time rolls around, that recent pay rise that just tipped you over $90,000 suddenly isn’t looking so flash. That’s because the MLS starts at 1% and, if your annual income* continues to increase, it can be up to 1.5%. Certainly enough to make your eyes water.
But, if your annual income* is over the above thresholds and you take out ahm hospital cover you can wave goodbye to the MLS and say hello to a healthy peace of mind and, potentially, save some money at the same time. Talk about a win-win.
Over 31 with no hospital cover? Then you should know about Lifetime Health Cover loading
If you’ve just blown out the candles on your twenties, you’re probably feeling a little bit older and a little bit wiser. But did you know that if you don’t have hospital cover by 1 July following your 31st birthday, you’ll start to carry the Lifetime Health Cover loading (LHC).
The LHC loading adds an extra 2% to the cost of your hospital cover premiums for every year over the age of 30 you don’t have private hospital cover (with a maximum loading cap of 70%). Once you have paid LHC loading on hospital cover for 10 continuous years, LHC loading is removed.
It’s a great reason to get covered now so you can avoid the financial sting later on.
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