EDIT: Refer to Medicare Levy Low Income Thresholds 2011 for the latest rates and how to claim this on your 2011 tax return.
The rate of the Medicare levy is 1.5% of taxable income. In some cases, you may be exempt from the medicare levy or eligible for a reduction based on family income.
The Medicare Levy is not payable (or is payable at reduced rates) by individuals and families on low incomes and by certain pensioners.
Individuals
The 2009-10 Medicare Levy low-income thresholds for individuals are as follows:
| Single Taxpayer | Threshold Amount 1 |
Phase-in Limit 2 |
1.5% at or Above 3 |
|
Not eligible for Senior Australians Tax Offset or Pensioner Tax Offset
|
18,488 | 18,489 – 21,750 | 20,935 |
|
Eligible for the Senior Australians Tax Offset
|
29,867 | 29,868 – 35,137 | 33,962 |
|
Eligible for Pensioner Tax Offset only
|
27,697 | 27,698 – 32,584 | 29,764 |
1. No Medicare Levy is payable on taxable income at or below the threshold amount.
2. Medicare Levy is payable at 10% of the excess over the threshold amount.
3. The Medicare Levy of 1.5% applies to the entire amount of taxable income.
Families
The Medicare Levy low-income threshold for families will be $31,196 (previously $30,025), and the additional amount of threshold for each dependent child or student will increase to $2,865 (previously $2,757).
Article by Christie Lewis
Christie is Practice Manager at Alan Lewis Accountants . Besides accounting, her passion is for all things small business (and blogging, of course). You can contact Christie directly at christie@lewistaxation.com.au.
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