You might save hundreds or thousands of dollars in rebates!

From 1 July 2012, the private health insurance rebate will be means tested against your “income”.  Per the Australian Taxation Office (ATO), the income thresholds for the 2012/13 tax year are shown below:

Unchanged

Tier 1

Tier 2

Tier 3

Singles

$84,000

or less

$84,001-97,000

$97,001-130,000

$130,001 or more

Families*

$168,000

or less

$168,001-194,000

$194,001-260,000

$260,001 or more

Rebate
Aged under 65

30%

20%

10%

0%

Aged 65-69

35%

25%

15%

0%

Aged 70 or over

40%

30%

20%

0%

Medicare levy surcharge
Rate

0.0%

1.0%

1.25%

1.5%

* The family income threshold is increased by $1,500 for every child after the first child.

 

Note, the definition of “income” for this test is the sum of your:

1)    taxable income (including net capital gains, and including the net amount on which family trust distribution tax has been paid)

2)    reportable fringe benefits (as reported on your payment summary)

3)    total net investment losses (both net financial investment losses and net rental property losses)

4)    reportable super contributions (includes reportable employer super contributions and deductible personal super contributions)

5)    exempt foreign employment income

Less:

6)    (if you are aged 55-59 years old) any taxed element of a super lump sum, other than a death benefit, which you received that does not exceed your low rate cap.

 

If your “income” in 2012/13 is shown in the “Unchanged” category above, then the above means testing will not apply to you.

However, if your income in 2012/13 puts you in either of the Tier 1, 2, or 3 categories above, then you could save hundreds or thousands of dollars by pre-paying your private health insurance premiums.  Pre-paying means that you pay your premiums, for some or all of the 2012/13 tax year, on or before 30 June 2012.

The ATO has confirmed that you can effectively receive the current 30% rebate for any private health insurance premiums that you pre-pay by 30 June 2012.

If you are interested in making significant savings from these

pre-payments, we recommend that you:

1

Contact us on 07 3727 8822 or email to jerry@leaderaccountancy.com.au to briefly discuss your situation and confirm your eligibility;

2

Contact your private health insurer to verify that they can correctly process any prepayments; and

3

Make the payment well before 30 June 2012, to allow your health fund to process your prepayment on or before 30 June 2012.

Share This