Tax

Medicare levy

The Medicare levy is the amount of money paid regularly by taxpayers which is used by government to assist in providing public health services. The level is deducted from wages and salaries as a fixed percentage of income or paid annually by non salary earners.

The Medicare levy surcharge (MLS) is a levy, or an extra tax, on Australian taxpayers who do not have private hospital cover and who earn above $50,000 for individuals and $100,000 for families, increasing by $1,500 for each child.

The surcharge is calculated at the rate of 1% of taxable income. It is in addition to the Medicare levy of 1.5%, which is paid by most Australian taxpayers. The Medicare levy surcharge is imposed on individuals earning over the threshold who do not have an appropriate level of hospital insurance.

To avoid the surcharge, you must have an approved hospital cover policy with a registered health insurer with a low front-end deductible, or with an excess equal to or less than $500 per annum for single policies, or $1,000 per annum for families/couples.

For further information on Medicare levy surcharge, refer to the Medicare levy surcharge link on the Tax office website.

For more information about the Medicare levy, refer to the Medicare levy link on the Tax office website.