Medicare Levy and Thresholds 2009/2010
July 28th, 2010
Medicare Levy – 2009/10
General Rate
|
Taxpayer |
Rate % |
|
Individual (resident) |
1.5% of taxable income |
Low-income Thresholds – Individuals
The 2009/10 Medicate Levy low-income thresholds for individuals are as follow;
|
Single Taxpayer |
Threshold Amount ¹ $ |
Phase-in Limit²
$ |
1.5% at or Above³ $ |
| Not eligible for Senior Australians Tax Offset or Pensioner Tax Offset |
18,488 |
18,489 – 21,750 |
21,751 |
| Eligible for Senior Australians Tax Offset |
29,867 |
29,868 – 35,137 |
35,138 |
| Eligible for Pensioner Tax Offset only |
27,697 |
27,698 – 32,584 |
32,585 |
- No Medicare Levy is payable on taxable income levels at or below the Threshold Amount.
- Where taxable income falls within the Phase-in Limit, Medicare Levy is payable at 10% of the excess over the Threshold Amount.
- The Medicare Levy of 1.5% applies to the entire amount of taxable income.
Medicare Levy Surcharge Thresholds¹
A surcharge of 1% is imposed on top of the 1.5% Medicare Levy where a taxpayer, their spouse or dependants do not have private patient hospital cover and the taxpayer’s ‘income for Surcharge proposes’, exceeds the relevant threshold from the following table².
|
No. Of Dependent Children or Students |
Singles³ $ |
Family4 $ |
|
0 |
73,000 |
146,000 |
|
1 |
146,000 |
146,000 |
|
2 |
147,000 |
147,500 |
|
3 |
149,000 |
149,000 |
|
4 |
150,000 |
150,500 |
|
5 |
152,000 |
152,000 |
|
Each extra child |
+1,500 |
+1,500 |
A taxpayer’s “income for surcharge purposes’ (from 2009/10) is the sum of:
- their taxable income (including the net amount on which family trust distribution tax has been paid);
- reportable fringe benefits;
- reportable superannuation contributions;
- exempt foreign employment income;
- total investment loss (including net financial investment losses and net rental losses)
Less any taxed component of a superannuation lump sum received which does not exceed the taxpayer’s low rate cap.
- A policy taken out where the annual excess is greater than $500 for singles ($1,000 for couples), is deemed not to provide private patient hospital cover.
- Where a single taxpayer has dependants, the ‘income for surcharge purposes’ of the dependants does not count towards the family threshold.
- Where a married couple has dependants, only the ‘income for surcharge purposes’ of the spouses is taken into account.
Family Thresholds
A taxpayer who:
- Has a spouse (married or de facto) on the last day of the income year;
- Has not remarried after their spouse died during the income year; or
- Who is eligible for the notionally retained sole parent rebate, the housekeeper or the child-housekeeper rebates (or would be entitled if they did not qualify for the Family Tax Benefit Part B); may be eligible to pay no (or a reduced) Medicare Levy if their family income is within the thresholds set out below.
The 2009/10 Medicare Levy thresholds for families are as follows:
|
No. Of Dependent Children/Students $ |
Family Income Threshold¹ $ |
Reduced Levy²
$ |
1.5% At or above³ $ |
| Taxpayer Not Eligible for Senior Australians Tax Offset | |||
|
0 |
31,196 |
31,197 – 36,701 |
36,702 |
|
1 |
34,061 |
34,062 – 40,071 |
40,072 |
|
2 |
36,926 |
36,927 – 43,442 |
43,443 |
|
3 |
39,791 |
39,792 – 46,812 |
46,813 |
|
4 |
42,656 |
42,657 – 50,183 |
50,184 |
|
5 |
45,521 |
45,522 – 53,554 |
53,555 |
|
6 |
48,386 |
48,387 – 56,924 |
56,925 |
|
Each Extra Child |
2,865 |
|
3,370 |
| Taxpayer Eligible for Senior Australians Tax Offset | |||
|
0 |
43,500 |
43,501 – 51,176 |
51,177 |
|
1 |
46,365 |
46,366 – 54,547 |
54,548 |
|
2 |
49,230 |
49,231 – 57,917 |
57,918 |
|
3 |
52,095 |
52,096 – 61,288 |
61,289 |
|
4 |
54,960 |
54,961 – 64,658 |
64,659 |
|
5 |
57,825 |
57,826 – 68,029 |
68,030 |
|
6 |
60,690 |
60,691 – 71,399 |
71,400 |
|
Each Extra Child |
2,865 |
|
3,370 |
- Family Income is the combined income of a taxpayer and their spouse. If the taxpayer does not have a spouse, Family Income is the taxpayer’s taxable income only. No Medicare Levy is payable on taxable income levels at or below the Family Income Threshold.
- The Medicare Levy shades in at 10% for every dollar where family income exceeds the Family Income Threshold. There is no ‘Phase-in Limit’ stated for families as there is with individuals since the figures change with the number of dependants. Instead, a formula is applied to reduce the levy payable by families to 10% of the amount by which family income exceeds the Family Income Threshold. The reduction is calculated as: A – (0.085 x (B – C)) where A is 1.5% of the relevant Family Income Threshold, B is the Family Income and C is the Family Income Threshold. Where the levy is also payable by the spouse, the reduction is shared according to the proportion that the taxable income of each bears to the total family income.
The levy payable by the relevant taxpayer is 1.5% of their entire taxable income
