The levy is payable on taxable income, and is in addition to your income tax. Individuals and families on higher incomes who do not have an appropriate level of private hospital cover may have to pay the Medicare levy surcharge.

From 1 July 2012, the private health insurance rebate and Medicare levy surcharge will be income tested against the income tier thresholds in the below table. Your rebate percentage entitlement will be reduced as your income tier rises.

2024 - 2025	Base tier	Tier 1	Tier 2	Tier 3
Single threshold	$97,000 or less	$97,001-113,000	$113,001-151,000	$151,001 or more
Family threshold	$194,000 or less	$194,001-226,000	$226,001-302,000	$302,001 or more
2023 - 2024	Base tier	Tier 1	Tier 2	Tier 3
Single threshold	$93,000 or less	$93,001-108,000	$108,001-144,000	$144,001 or more
Family threshold	$186,000 or less	$186,001-216,000	$216,001-288,000	$288,001 or more
2014 - 2023	Base tier	Tier 1	Tier 2	Tier 3
Single threshold	$90,000 or less	$90,001-105,000	$105,001-140,000	$140,001 or more
Family threshold	$180,000 or less	$180,001-210,000	$210,001-280,000	$280,001 or more
Health Insurance Rebate Percentage Entitlement
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%

Note: The income tiers are indexed annually. For more information about what is included as income for Medicare levy surcharge purposes, see Income for Medicare levy surcharge purposes.

The Medicare Levy Surcharge is in addition to the 2% Medicare levy. It is calculated at the rate of 1%, 1.25% or 1.5% of:

• your taxable income
• your reportable fringe benefits, and
• any amount on which family trust distribution tax has been paid.

The Medicare levy is normally calculated at 2% of your taxable income but this rate can vary depending on the individual's circumstances.

You may be exempt from the levy or it may be reduced if you:

• Have a low income; or
• Are a prescribed person.

From 1 July 2014, the government increased the Medicare levy from 1.5% to 2%.

2022-23 Medicare Levy - Individuals:

2022-23 Medicare Levy - Families:

(1) You do not have to pay the Medicare levy if your family income is equal to or less than the family income threshold.

(2) The rate of 10% of the difference between the taxable income and the lower income limit is payable where the taxable income does not exceed the upper income limit. 

(3) If you are entitled to the seniors and pensioners tax offset.

(4) The full rate of 2.0% levy is applicable above the Upper Income Limit.

A Medicare levy calculator is available at the ATO website to help you calculate your financial obligation.

For more information see the Medicare levy essentials homepage on the ATO website.

The 2012/2013 annual threshold for the net medical expenses tax offset of 20% is $2,120.

The 2013/2014 annual threshold for the net medical expenses tax offset of 20% is $2,162.

The medical expenses tax offset has changed. Expenses you can claim are restricted to disability aids, attendant care or aged care.