HECS and HELP Student Loan Scheme Repayments
The student Higher Education Loan Program (HELP – previously HECS etc) repayments are recovered by the Tax Office in your annual tax return, based on your annual income.
The repayment rates are set year-by-year and are set out in the tables below.
(See also SFSS repayments here)
Interest is not charged on the loans, however the amount of the debt is adjusted (increased) on 1 June each year in accordance with an annually determined inflation factor. The year-by-year indexation rates are set out in the tables below – see “Debt indexation“.
HECS loan balances can be reviewed through the my.Gov.au portal.
Trade Support Loan Scheme
Under the Trade Support Loans scheme from 1 July 2014 eligible apprentices have access to loans totalling up to $20,000 (indexed annually) over the course of their apprenticeship, with the adoption of the HECS/HELP structure for repayments from tax assessments. The Tools For Your Trade grants scheme ceased on 30 June 2014. See further here: Trade Support Loan Program.
HECS/HELP Repayment Calculations
As an employee, if you are earning a high enough wage or salary (see thresholds table below) your periodic tax instalments are required to be increased to include a little extra from each pay to repay the HECS or HELP loan.
Tax instalment schedules
Calculated tax instalment deductions for payroll purposes can be calculated from the tax instalment schedules here (including links to printable PDFs).
Any calculated repayment amount for each tax year is also detailed on your income tax assessment, along with the loan balances.
Repayment Income Thresholds and Rates
Repayment Income – Adjusted Taxable Income
The calculation of income for repayment purposes has an expanded definition – your repayment assessment is based on your “repayment income“, which is calculated as follows:
= Taxable income plus the following
+ Total net investment loss (which includes net rental losses)
+ Total reportable fringe benefits amounts
+ Reportable super contributions
+ Exempt foreign employment income
= Repayment Income
Income thresholds are inflation-adjusted each year. Additionally, if you are entitled to a Medicare reduction or exemption due to low family income, a compulsory repayment is not required for that year.
Voluntary Payments and Voluntary Payment Bonus
Voluntary repayments can be made at any time, but the bonuses for doing so have been abolished.
Repayment bonuses removed from 1 January 2017
Originally flagged by the previous Labor government, the bonuses for voluntary or upfront HECS-HELP payments are no longer be available after 1 January 2017. Enabling legislation has now been passed by parliament which provides that:
- a person will not receive up-front payment discount for a payment made in relation to a unit of study with a census date on or after the first 1 January 2017.
- a person will not receive the HELP voluntary repayment bonus for voluntary payments made on or after the first 1 January 2017.
The position up to 31 December 2016 was:
- Additional voluntary repayments of $500 or more earn a 5% bonus credit (10% up to 31 December 2011).
- The bonus credit is received for each eligible repayment, or on clearance of the debt balance.
- Higher Education Loan Program (HELP) and other student loans: a quick guide (1 May 2017)
- SFSS Repayments
- Work related self education expenses
This page was last modified o2017-12-18