HECS/HELP Tax Bills!!

Help/Hecs what you need to know for your Tax

So, you have undertaken some study to make yourself a learned person. If you did not have the money to pay the excessive course fees upfront (who does) then you probably took advantage of the governments' generosity and had them pay for it. These fees are now in the form of a HECS-HELP debt or Student Financial Supplement debt, depending on when you studied. The unfortunate part is they will want these debts repaid. If you are unsure how this will affect your e-tax return, then continue reading.

Your first question probably is, how is my HECS-Help debt repaid? The debt is handled by the tax system, once your income reaches a repayment threshold you have a compulsory repayment included as part of your e-tax assessment. The starting point for the 2017/18 year is $55,874. If you earn over this, it is time to pay some HECS-Help debt. The unfortunate news for those earning a little less is, this threshold is decreasing over the next couple of years. For the 2018/19 year the threshold is $51,957 and for the 2019/20 year it is $45,881. This means you may have to make repayments earlier than expected. Please note it is not just your taxable income that is used to determine whether you are required to make a repayment. To ensure they catch all those trying to reduce their taxable income they created what they call repayment income. Repayment income is calculated from the amounts given on your income e-tax return for:

• your taxable income;

• reportable fringe benefits (reported on your payment summary);

• total net investment loss (which includes net rental loss);

• reportable super contributions; and

• exempt foreign employment income amounts.

So, how much do I pay you ask? We will discuss that next week...

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Note that the information provided is general in nature and subject to change, please contact one of our professionals who can evaluate your circumstances and provide more accurate advice to your current situation.