What is the Medicare Levy Surcharge (MLS)?
The Medicare Levy Surcharge (MLS) is a tax set by the Australian Government. It applies to individuals and families on higher incomes who don’t have eligible private hospital cover. It goes directly to funding the national public Medicare system and was designed to encourage the use of the private hospital system to reduce the demand on Medicare.
How is it different from the Medicare Levy?
Most Australians will have to pay the Medicare Levy, regardless of whether they have private health insurance. The Medicare Levy Surcharge is an additional amount that is payable for individuals or families that are high income earners, and do not hold private health insurance.
Do I have to pay the MLS?
You may have to pay the Medicare Levy Surcharge if you or your dependants do not have private patient hospital cover and are:
- A single person (without dependent children) and have a taxable income above $90,000 (including any reportable fringe benefits of $1,000 or more)
- A family (including a couple or single parent) with a combined taxable income above $180,000 (including any reportable fringe benefits of $1,000 or more)
How much is the MLS?
|If you are:||And your combined taxable income is:|
||$90,000 or less
||$90,001 - $105,000
||$105,001 - $140,000
||$140,001 or more
|Couple/Family/Single Parent (increases by $1,500 per child after your first)
||$180,000 or less
||$180,001 - $210,000
||$210,001 - $280,000
||$280,001 or more
|Then your Medicare Levy Surcharge is
||Nothing to pay - 0.0%
||Tier 1 - 1.0%
||Tier 2 - 1.25%
||Tier 3 - 1.5%
The income tiers will change each year and we’ll update you once we hear from the government on what they are. Updated April 2021.
How can I avoid paying the MLS?
If your annual taxable income falls within the MLS range you can avoid the tax altogether by taking out hospital cover. You will avoid paying MLS for the number of days you’re covered in the previous financial year.
Where can I get more information?
For more information about the Australian Government Rebate or the Medicare Levy Surcharge you can: