Ways to save tax on Health Insurance
Government Incentives and Penalties - The Australian government has put in place a number of initiatives designed to get Australians covered by private health insurance. If you know what these initiatives are, you may be able to save on tax, time and money...
The 30% Government Rebate on Private Health Insurance
A 30 per cent rebate on annual health fund premiums, regardless of income and from 1 April, 2005, the rebate was increased to 35 per cent for those aged between 65 and 69, and to 40 per cent for those aged 70 or older.
- Learn more about the 30% Rebate
The Medicare Levy Surcharge
By taking out eligible levels of Private Health Insurance you may be able to save on tax (MLS). For the tax year 2009/10, if you don't have the appropriate level of hospital insurance and are either single with a taxable income of $73,000 or more per year, or a couple or family earning a combined taxable income of $146,000 or more, you may be forced to pay an extra 1% in tax (MLS).
This is called the Medicare Levy Surcharge and can equate to a minimum of $730 a year for singles and $1,460 a year for qualifying families. Essentially this is money that is foregone and could have been used to purchase private cover. In addition to avoiding paying the extra tax, the Federal Government rebates 30% of your health insurance costs (levels of rebate depend on the age of the insured persons).
As of July 1 2010 new MLS thresholds of $77,000 for singles and $154,000 for couples or families apply.
- Learn more about the Medicare Levy Surcharge
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