Thread: medicare question from a dumb Pom

Medicare levy is simply added on to your tax deduction, as is the levy if you are liable, so they just appear as a higher tax rate, albeit shown separately.

Not sure about how it changes when you take out private health insurance - I'm pretty sure you end up not paying it from the date of your private insurance, but you will not get your pay deductions changed until you put in a certificate to your employer, and adjustments are made when your tax return is assessed. Your employer's pay office should be able to advise you.

John

medicare levy (1.5% of gross wage) is taken as part of the tax withheld from your wage each pay period.

Medicare surcharge (1% of taxable income) is calculated on your year end tax return if in 2008 financial year you earnt over 50,000 (or 100,00 for couple) and did not hold private health insurance for the year you get stung.

if you have private health for part of year (ie you get it now) the surcharge is pro rata...

in 2009 it will be 100K for an individual i think.



ps that assumes you are a resident pom not just visiting

thanks guys that kinda clears it up.. except one bit..

when do we pay it and how is it charged?

if we have nothing back from tax and owe nothing will we get a bill for 1% of our wages? (ouch) and is it paid at tax time..

Thanks

Steve

Originally Posted by 5teve

thanks guys that kinda clears it up.. except one bit..

when do we pay it and how is it charged?

if we have nothing back from tax and owe nothing will we get a bill for 1% of our wages? (ouch) and is it paid at tax time..

Thanks

Steve

I did my first Aus tax return last year, and one of the questions asked was whether I had private health insurance. I did, so didn't get hit with a bill.

My assumption is I would have got whacked an extra 1% of income if I'd answered no to that, and it would have been owed in a lump sum.

Whether you can ask an employer to take it at source as well I don't know. However, depending on your income, you may very well find a private plan is cheaper as well as being better. If I remember correctly, depending on age, there is also a potential surcharge if, as a migrant, you leave it longer to than a year to take out private medical as well.

The base charge (levy) is taken at source by your employer (Assuming you are employed as opposed to self employed).

Its on your tax dont stress mate , till tax time

Originally Posted by 5teve

thanks guys that kinda clears it up.. except one bit..

when do we pay it and how is it charged?

if we have nothing back from tax and owe nothing will we get a bill for 1% of our wages? (ouch) and is it paid at tax time..

Thanks

Steve

It will be calculated when you submit your tax return. If your MLS is higher than the tax return owing to you then yes you will get a bill.