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.
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 2011/12, if you don't have the
appropriate level of hospital insurance and are either single with a taxable income of $80,000 or more per year, or a couple or
family earning a combined taxable income of $160,000 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 $800.10 a year for singles and $1,600.05 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).
