What is the Medicare Levy Surcharge (MLS)?

HIF  Australia
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The Medicare Levy Surcharge (MLS) is a Federal Government initiative to encourage individuals to take out private hospital cover, and where possible, to use the private hospital system to reduce the demand on the public system. The MLS is levied on Australian taxpayers who do not have private hospital cover and who earn above a certain income. The income thresholds increase incrementally, as does the MLS itself, depending on your annual household ATI -  Adjusted Taxable Income

In this short clip, HIF Executive Manager Anne Humphrey joins the Everyday Health TV​ panel to discuss the Medicare Levy Surcharge and to provide clarity on the tax benefits of purchasing a private hospital insurance policy.

The current 2017/18 Adjusted Taxable Income thresholds are also outlined in the table below:

$90,000 or less
$180,000 or less
$90,001 - 105,000
$180,001 - 210,000
$105,001 - 140,000
$210,001 - 280,000
$140,001 or more
$280,001 or more
APPLICABLE MLS0%1.0%1.25%1.5%  

Please note: The thresholds increase annually based on growth in Average Weekly Ordinary Time Earnings. Single parents & couples (including de facto couples) are subject to family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.

Still confused? Here's a quick video to help yu get your head around it. 

Related links:

  • Use our tax calculator to see if you will pay the Medicare Levy Surcharge next year
  • How to avoid the Medicare Levy Surcharge and make a tax saving
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