Private health insurance rebate

The private health insurance rebate can take up to 33% off the cost of on your private health insurance premiums, depending on your age and income.

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What you need to know

  • The private health insurance rebate applies to people with taxable incomes of under $140,000 (singles) or $280,000 (couples or families).
  • The rebate is normally applied as a discount on your premiums, but can be applied at tax time.
  • For most people (aged under 65 and at the base income tier) their rebate will be around 24.6%.

What is the private health insurance rebate?

The private health insurance rebate is an amount that the Australian government contributes towards your health insurance premiums. It was set up to encourage Australians to take out private health insurance and has been income tested since 2012, meaning how much you get back is based on how much you earn.

You're eligible for the rebate if your taxable income is under $140,000 a year as a single or $280,000 as a couple or family. It also factors in your age and family status. Generally, the less you earn, the more you'll get back.

What private health insurance rebate am I eligible for?

The table below outlines the private health insurance rebate tiers for April 2021 to March 2022.

Singles≤$90,000$90,001-105,000$105,001-140,000≥$140,001
Families≤$180,000$180,001-210,000$210,001-280,000≥$280,001
Base TierTier 1Tier 2Tier 3
< age 6524.608%16.405%8.202%0%
Age 65-6928.710%20.507%12.303%0%
Age 70+32.812%24.608%16.405%0%

Rebate levels applicable from 1 April 2021 to 31 March 2022. Source: Private Healthcare Australia.

Who is eligible for the private health insurance rebate?

To qualify for the private health insurance rebate, you need to meet the following conditions:

  • Have a taxable income of less than $140,000 as a single, or $280,000 as a family (the threshold increases by $1,500 for every dependent child after the first).
  • Be an Australian citizen or permanent resident.
  • Hold a health insurance policy with an Australian-registered health insurer.
  • Be a Medicare card holder.

How do I get the private health insurance rebate?

If you're eligible for the private health insurance rebate, you can get it one of two ways:

  • Through premiums reductions – your private health insurer will apply the rebate to your health insurance premiums
  • As a refundable tax offset when you lodge your tax return online

Unlike the Medicare Levy Surcharge, you can claim the rebate for any insurance policy, whether that's extras cover, hospital cover or a combined package.

What happens if you select the wrong income tier?

If you choose to claim the private health insurance rebate as a premium reduction, you'll be asked to select a tier based on your estimated income – usually you do this when you take out or renew a policy.

  • If you select a higher tier than your actual income for the year, you should receive a tax offset through your income tax return for that financial year.
  • If you select a lower tier than your actual income for the year, your income tax return for that financial year will come with a 'tax liability', meaning you will owe money. There are no other consequences for incorrect estimates.

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